wife owns 100% of S-corp, how to move to husband?

Technical topics regarding tax preparation.
#1
juro  
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My client is applying for a big loan, and he want to omit his wife from the personal financial statements.
But his wife owns 100% of the business, an S-corp.

She has been listed as 100% owner for years on the tax returns.

So, now he wants to be the 100% owner.

Just file an updated corporate report with

https://cofs.lara.state.mi.us/corpweb/LoginSystem/ExternalLogin.aspx
 

#2
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What's the issue?
Steve
 

#3
juro  
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not sure yet, he included his wife earlier this year for another loan app.
she is only a waitress.
 

#4
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juro wrote:she is only a waitress.


That doesn't seem to be true. At the moment, she's also a business owner.
~Captcook
 

#5
juro  
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CaptCook wrote:
juro wrote:she is only a waitress.


That doesn't seem to be true. At the moment, she's also a business owner.



She is never present ar the business, hubby does not want her around all day, so she does the waitress thing, has so for years.
 

#6
HowardS  
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Name changes on the stock certificates and corporate documents. Should have an attorney handle this.
Retired, no salvage value.
 

#7
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Transferring the stock to him makes sense. I don't see a problem. And they don't need an attorney. All they need is a simple "I hereby assign all of my stock in X, INC. to you."
Steve
 

#8
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juro wrote:
CaptCook wrote:
juro wrote:she is only a waitress.


That doesn't seem to be true. At the moment, she's also a business owner.



She is never present ar the business, hubby does not want her around all day, so she does the waitress thing, has so for years.


You seem to equate "business owner" with "manager", which is a very different role. One is not dependent upon the other.

It a tangential point, but her being a waitress doesn't have any bearing on the apparent desire to transfer ownership. I'm sure there's a perfectly fine reason for it.
~Captcook
 

#9
juro  
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He changed his mind just now.
thanks for helping!
 

#10
JR1  
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LOL!
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Remembering our son, Ben Jan 22, 1992 to Aug 26, 2011.
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#11
damcpa  
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This makes me nervous. Have seen this happen in anticipation of divorce, and the spouse who was being transferred out of ownership was not aware that it was happening.
 

#12
juro  
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damcpa wrote:This makes me nervous. Have seen this happen in anticipation of divorce, and the spouse who was being transferred out of ownership was not aware that it was happening.



but how do they do it?
 

#13
sjrcpa  
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Forge signatures on the transfer docs?
 

#14
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juro wrote:
damcpa wrote:This makes me nervous. Have seen this happen in anticipation of divorce, and the spouse who was being transferred out of ownership was not aware that it was happening.



but how do they do it?


...or tell the wife this is only a paperwork deal and has no bearing on anything meaningful, when it actually does.
~Captcook
 

#15
damcpa  
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I've seen 2 similar situations in the past few years. In both cases, the wife owned a thriving business and the husband's job was to be the business manager. He handled all the business matters and she trusted him. Sometimes, the husband signed the wife's name for her on documents for property purchases in his name only. Or, he put the documents in front of her and he didn't completely explain the significance of what she was signing. In both cases, the husbands then wanted a divorce and the wife was caught totally off guard when things started coming to light. A number of things were solely in the guys' names. Yes, the wives should have been paying more attention. It was expensive to discover and settle in a divorce. I learned a big lesson about watching for early red flags with client couples.
 

#16
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damcpa wrote:I've seen 2 similar situations in the past few years. In both cases, the wife owned a thriving business and the husband's job was to be the business manager. He handled all the business matters and she trusted him. Sometimes, the husband signed the wife's name for her on documents for property purchases in his name only. Or, he put the documents in front of her and he didn't completely explain the significance of what she was signing. In both cases, the husbands then wanted a divorce and the wife was caught totally off guard when things started coming to light. A number of things were solely in the guys' names. Yes, the wives should have been paying more attention. It was expensive to discover and settle in a divorce. I learned a big lesson about watching for early red flags with client couples.


Great perspective. I had a potential client reach out this year and I could see the red flags from the get go. Mom had built a growing bridal gown business and hired daughter to help her run it. As daughter is engaged, it just so happened that daughter's fiancée is an accountant or accounting student of some sort. Mom wanted to gift 50% of the business to daughter since daughter was helping her grow the business. I could easily see the daughter taking over and I don't think the mom saw it at all...
 

#17
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That would have been a good case to consider an installment sale to the son-in-law.
Steve
 

#18
Nilodop  
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That would have been a good case to consider an installment sale to the son-in-law.. Right, so that way future son-in-law could take the business from the Mom and the daughter. (Insert sarcasm emoji).
 


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