S Corps have always been a popular choice of entity for closely held businesses because of certain tax advantages they have over LLCs. The new 3.8% Medicare tax, which applies differently to S Corps than to LLCs/partnerships, will increase the appeal of S Corps. But S Corpsare still fragile entities, with limitations on the number and type of shareholders they may have and restrictions on the type of equity and debt they may issue. Drafting the S Corp stockholders’ agreement is a careful balance of maximizing tax benefits, preventing the loss of the preferred tax status through inadvertently disqualifying corporate actions, and maximizing organizational flexibility in other areas. This program will discuss essential components of an S Corp stockholders’ agreement, including restrictions on capital structure and voting, transferability issues, equity and incentive compensation, and tax allocations and property distributions. Day 1 – February 19, 2013: · Business planning with S Corps and drafting stockholders’ agreements · Counseling clients on choice of entity considerations of S Corps v. LLCs/partnerships · Capital structure issues in stockholders’ agreements – restrictions on types of debt and equity · Transferability of interests and restrictions to preserve S Corp status · Planning for the merger or sale of an S Corp Day 2 – February 20, 2013: · Overview of new tax advantages of using an S Corp over an LLC after the new Medicare tax · Understanding the tax advantages/disadvantages of withdrawing money as salary or distributions · Incentive compensation issues, including fringe benefits and restrictions on deductibility · Planning for and drafting for distributions and allocations Speakers: Alson R. Martin is a partner in the Overland Park, Kansas office of Lathrop and Gage, LLP, where he has a national practice focusing on business law, taxation, health care, and retirement plans. He is a Fellow of the American College of Tax Counsel and the American College of Employee Benefits Counsel. Mr. Martin is the author of "Limited Liability Companies and Partnerships" and the co-author of "Kansas Corporation Law & Practice (Including Tax Aspects)." He is the president and a director of the Small Business Council of America. Mr. Martin received his B.A., with highest distinction, from the University of Kansas, and his J.D. and LL.M. from New York University School of Law.
S Corps have always been a popular choice of entity for closely held businesses because of certain tax advantages they have over LLCs. The new 3.8% Medicare tax, which applies differently to S Corps than to LLCs/partnerships, will increase the appeal of S Corps. But S Corpsare still fragile entities, with limitations on the number and type of shareholders they may have and restrictions on the type of equity and debt they may issue. Drafting the S Corp stockholders’ agreement is a careful balance of maximizing tax benefits, preventing the loss of the preferred tax status through inadvertently disqualifying corporate actions, and maximizing organizational flexibility in other areas. This program will discuss essential components of an S Corp stockholders’ agreement, including restrictions on capital structure and voting, transferability issues, equity and incentive compensation, and tax allocations and property distributions.
Day 1 – February 19, 2013:
· Business planning with S Corps and drafting stockholders’ agreements
· Counseling clients on choice of entity considerations of S Corps v. LLCs/partnerships
· Capital structure issues in stockholders’ agreements – restrictions on types of debt and equity
· Transferability of interests and restrictions to preserve S Corp status
· Planning for the merger or sale of an S Corp
Day 2 – February 20, 2013:
· Overview of new tax advantages of using an S Corp over an LLC after the new Medicare tax
· Understanding the tax advantages/disadvantages of withdrawing money as salary or distributions
· Incentive compensation issues, including fringe benefits and restrictions on deductibility
· Planning for and drafting for distributions and allocations
Speakers:
Alson R. Martin is a partner in the Overland Park, Kansas office of Lathrop and Gage, LLP, where he has a national practice focusing on business law, taxation, health care, and retirement plans. He is a Fellow of the American College of Tax Counsel and the American College of Employee Benefits Counsel. Mr. Martin is the author of "Limited Liability Companies and Partnerships" and the co-author of "Kansas Corporation Law & Practice (Including Tax Aspects)." He is the president and a director of the Small Business Council of America. Mr. Martin received his B.A., with highest distinction, from the University of Kansas, and his J.D. and LL.M. from New York University School of Law.