Only certain trusts can own S corporation stock
S corporations must comply with strict requirements or risk losing their tax-advantaged status. In an estate planning context, it’s critical that any trusts that will receive S corporation stock through the operation of your estate plan be eligible shareholders. Potentially eligible trusts include grantor trusts, testamentary trusts, QSSTs and ESBTs. If you have S corporation stock that will be distributed to a trust, we can help you assess whether its terms could inadvertently disqualify the S corporation. Contact us with further questions.