The Jobs Act-Tax UpdateThe Jobs Act-Tax Update
The American Jobs Creation Act of 2004, signed into law Oct. 22, made some key changes to the S Corporation rules. As David A. Handler, in the Chicago office of Kirkland & Ellis LLP, reports: Internal Revenue Code Section 1361(b)(1)(A) provides that an S corp. may not have more than 75 shareholders. The Jobs Act amended this provision to increase the maximum to 100. The act also amended IRC Section
December 1, 2004
Rorie M. Sherman Editor in Chief
The American Jobs Creation Act of 2004, signed into law Oct. 22, made some key changes to the S Corporation rules. As David A. Handler, in the Chicago office of Kirkland & Ellis LLP, reports: Internal Revenue Code Section 1361(b)(1)(A) provides that an S corp. may not have more than 75 shareholders. The Jobs Act amended this provision to increase the maximum to 100.
The act also amended IRC Section 1361(c)(1) so that it provides that, in addition to treating a husband and wife (and their estates) as one shareholder for purposes of the 100-shareholder rule, family members also may elect to be treated as one shareholder. This rule will vastly increase the number of actual shareholders permitted for an S corp....
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