How to Keep an S Corporation Business & File for a Personal Bankruptcy

Related Articles For the purposes of filing personal bankruptcy, it does not matter if your business is an S corporation or a C corporation. What impacts bankruptcy law is that your assets are shielded inside a corporation, not the corporation’s tax treatment. Because your corporation is legally distinct from you, your bankruptcy as a shareholder does not impact the corporation. However, the shares you own in the corporation become an asset of your bankruptcy estate. S Corporation and Taxation An S corporation is an election you make by filing Form 2553 with the Internal Revenue Service. If the IRS grants the election, you avoid the double taxation of C corporations (regular corporations.) Instead, the IRS taxes all shareholders solely at the shareholder level. In addition, the IRS places restrictions on S corporations including no more than 100 shareholders and ownership by domestic individuals, not companies or foreigners. However, none […]