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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10809
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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STOCKHOLDER IN A S-CORP, MY CO FILED THE CORP RETURN BUT I

Customer Question

I AM A STOCKHOLDER IN A S-CORP, MY CO FILED THE CORP RETURN BUT I DID NOT FILE AS A NON RESIDENT BECAUSE I WAS UNDER THE IMPRESSION THAT I WAS INCLUDED IN THE FILING SINCE I CHECKED OFF AS FILING AS AN S-CORP, I OWN THE CO 100%. THEY ARE NOW ASKING ME TO FILE GOING BACK TO 2000, WHAT SHOULD I DO
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.

Hi,

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can you add a litle more detail please?

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What form are you being asked to file?

Expert:  Lane replied 1 year ago.

The way filing for an S-Corp normally works is that (since the S-Corp is a passthrough and doesn't pay income tax), the 1120-S (S-Corp return) generates a K-1 for the owner to use with his own taxes.

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Are you saying that you are not a tax resident in the U.S?

Expert:  Lane replied 1 year ago.

IF THAT's the case then we may have other issues...

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The tax code provides that a S-Corporation must not have a nonresident alien as a shareholder (see, IRC Section 1361(b)(1)(C)). Treasury Regulation Section 1.1361-1 states that “a corporation having a shareholder who is a ‘nonresident alien’ as defined in Section 7701(b)(1)(B) does not qualify as a small business corporation.”

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Section 7701(b)(1)(B) provides — in typical IRC legalese — that a person is a nonresident alien if he isn’t a resident alien. Having a particular visa has no impact on whether a non-resident alien can be a S-corporation shareholder. Only a green card or meeting the IRS’ “substantial presence test” enables an alien to be eligible to be an S Corporation shareholder.

Expert:  Lane replied 1 year ago.

Hi, just checking back in ... Have I understood your question correctly?

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Let me know ... and if so, providing a little more detail (which forms they are asking for, for example) will help meto give you a mnore specific answer.

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Let me know

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Lane

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