1120-US: Shareholders listed in the consent to the S Corporations Section 1377(a)(2) election (FAQ)

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Question

Which shareholders are listed in the consent to the S Corporations Section 1377(a)(2) election?

Answer

When the S Corporation makes an election under Section 1377(a)(2), all the affected shareholders must consent to the election. An affected shareholder is one whose interest is terminated and all of the shareholders to whom such shareholder has transferred shares during the taxable year. If the shareholder has transferred shares to the corporation, then the affected shareholders are all of the shareholders during the taxable year.

Therefore, UltraTax CS lists the following shareholders in the consent report:

Related topic: 1120-US: Shareholder termination and qualifying dispositions FAQs

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