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Anne
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2439
Experience:  Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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I want to merge 2 sub-s corps that I own with my husband.

Resolved Question:

I want to merge 2 sub-s corps that I own with my husband. They are similar businesses. We don''t want to have to pay dividends or gains. What is the best way to handle the accounting for this?
Submitted: 9 years ago.
Category: Tax
Expert:  RD replied 9 years ago.
Are you owner of one Sub S Corp and your husband owner of another and you are planning to merge the two?
Customer: replied 9 years ago.
Reply to RD's Post: No, we own both companies jointly. One is located in Nevada, one in Texas. We want to consolidate everything into the Texas company.
Expert:  Anne replied 9 years ago.

HiCustomer/p>

Thank you for using justanswer. The easiest and best way to accomplish this without any tax consequences, is to have 1 S Corporation become the "parent" S Corporation and treat the other S Corporation as qualified subchapter S subsidiary. In doing this, the subsidiary is ignored as a separate entity for income tax purposes and all of the subsidiary's assets, liabilities, and items of income, deduction, and credit generally are treated as those of the parent. You would make this election by filing Form 8869 (Rev. July 2005)Qualified Subchapter S Subsidiary Election

Please also see the following link for more information:


Instructions for Form 2553 (12/2007) 

I hope this helps and best of luck to you.

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Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2439
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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