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Lane
Lane, JD, CFP, MBA, CRPS
Category: Finance
Satisfied Customers: 12047
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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Can an Arizona S corp issue stock to an individual one

Customer Question

Can an Arizona S corp issue stock to an individual for only one division of the corporation?
Submitted: 1 year ago.
Category: Finance
Expert:  Lane replied 1 year ago.

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Hi,

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Not exactly. One of the requirements of s-corps is that they only have one class of stock.

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And what that ends up meaning is that each shareholder owns SOME percentGe of the entire S-Corp.

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What can do, however, is have a shareholder agreement that grants certain rights and duties.

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This is why the LLC is the fastest growing entity out there ... (Provide the corporate liability protection of a corporation but the flexibility of a partnership)

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You can write the operating agreement to set up ownership interest, voting interests, management rights, sharing of profit and loss, any way you like.

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But again, the way to get SOME of these kinds of things done if the s-corp already exists is through shareholder agreements

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Let me know if you have questions

Expert:  Lane replied 1 year ago.

Hi,

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I'm just checking back in to see how things are going.

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Did my answer help?

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Let me know…

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Lane

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If this HAS helped, and you don't have questions, I'd appreciate a positive rating (by clicking the stars or smiley faces on your screen) ... that's how we're credited for the work here)

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