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S Corp taxation might not be the most exciting topic, but here you are, reading up on the excess net passive income (ENPI) tax . So, let's cover this issue quickly and as painless as possible. If an S Corp was converted from a C Corp (and thus it has an AE&P account), you may potentially get into an unpleasant situation - additional tax (which stings!) on passive income. This is something the IRS checks on, especially if amounts are material. How can the IRS say that the S C

If you own an S corporation and are also actively involved in its operations, the IRS expects you to pay yourself reasonable compensation...

Shareholders must keep thorough and accurate records to support their stock basis. (See Treas. Reg. § 1.6001-1(a) and they are...