Posted by Roger Garay, E.A. on June 27, 2004 at 21:47:22:
Yes indeed, our beloved California does like to muck things up.
Consider setting up the new, window washing business in an S-Corporation.
I assume from your question the existing C-corporation is a CA corporation, that your property management is done by yourselves, and that you will be material participant in the new busines. If so remember that Corporate Officers are by definition “employees” and you must pay yourself a “reasonable wage” IRC Sec 3121(d)–See newsletter on same subject at my web site www.olbts.com.
Roger Garay, EA
Multiple Corporations & Controlled Group Issue - Posted by Jason
Posted by Jason on May 23, 2004 at 21:59:30:
I have a C-Corp for property flips and rental management, and a LLC for long-term property holding. Both my wife and I are equal owners of the two existing separate entities. I am now purchasing a window washing business. If I set this up as a second C-Corp, also owned by myself and my wife, will I be running into a “Controlled Group Status” problem? Would it be better to set this business up as a LLC? Can the existing C-Corp be the sole shareholder of the new C-Corp if no monies or services transpire between the two, or do I still have the same problem? Is there a good way to “umbrella” multiple entities under one primary entity like this? I am in California (which always seems to complicate things) Thank you!