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Starting S corp on EAD, will it be a issue ?

Discussion in 'Businesses' started by sb15, Oct 30, 2010.

  1. sb15

    sb15 Member

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    Ron

    Just want to confirm particularly about S-corp on EAD. I had gone through some forums/google etc, some one says clearly that we cannot start S-corp on EAD and as per IRS rules S-corp owner needs to be GC holder/ US citizen,
    Is it really true ? Can you please confirm ?

    Thanks a lot in Advance..

    sb
     
  2. Roy Vargis

    Roy Vargis Super Moderator

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    Re: Starting S corp on EAD, will it be a issue ?

    SB,
    Share holders of an S Corp should be an resident in US. This does not mean that they have to be GC holder/US Citizen. A person's residence status is determined based on their presence in the Country. Which means that using the substantial presence test, if a person resides in US for more than 183 days, he/she would be a resident for tax purpose and will be eligible to file an S Corp. However if the shareholder travels out of US for an extended period, he/she may become a non-resident and lose the S Corp status. If this seems a possiblity you could register the company as an LLC and still avail the benefit of pass thru for tax. Like S Corp, LLC will not be subject to double taxation. The shareholders of the LLC will include the profits from the business while filing their personal tax returns.
     
  3. sb15

    sb15 Member

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    Re: Starting S corp on EAD, will it be a issue ?

    Roy,

    Thank you very much for clarifying my doubt. I appreciate it.

    My best regards
    sb
     
  4. Roy Vargis

    Roy Vargis Super Moderator

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    Re: Starting S corp on EAD, will it be a issue ?

    Good luck on your new venture.
     
  5. Vernon98

    Vernon98 Junior Member

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    Re: Starting S corp on EAD, will it be a issue ?

    I had gone through some forums/google etc, some one says clearly that we cannot start S-corp on EAD and as per IRS rules S-corp owner needs to be GC holder/ US citizen, Is it really true ?
    [​IMG]
    [​IMG]
    [​IMG]
     
  6. Roy Vargis

    Roy Vargis Super Moderator

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    Re: Starting S corp on EAD, will it be a issue ?

    Vernon,

    Give me a call and I will clarify this for you.
     
  7. manishmanish

    manishmanish Junior Member

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    Re: Starting S corp on EAD, will it be a issue ?

    I currently have an EAD and established my LLC. Can I pay myself a salary in order to generate paystubs to invoke AC21?
     
  8. Ron Gotcher

    Ron Gotcher Attorney at Law

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    Re: Starting S corp on EAD, will it be a issue ?

    Yes you can.
     
  9. Roy Vargis

    Roy Vargis Super Moderator

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    Re: Starting S corp on EAD, will it be a issue ?

    I dont see an issue with the S Corp. If any specific question do email me. info at nexusltd.com
     
  10. thirumala r dasari

    thirumala r dasari New Member

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    Hi Ron

    This is Dr.D a small animal veterinarian, from Virginia, currently on H1B status even though I got my EAD via EB2 , wondering if I can start my own business of starting a small animal clinic or it has to be under my wife , who also has an EAD but on H4B status ?

    Can you please let me know of your suggestion ? Thanks in advance.
    Sincerely,
    Dr.D
     
  11. thirumala r dasari

    thirumala r dasari New Member

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    Hi Ron

    This is Dr.D small animal veterinarian, from Virginia, currently on H1B status even though I got my EAD via EB2 , wondering if I can start my own business of starting a small animal clinic or it has to be under my wife , who also has an EAD but on H4B status ?

    Can you please let me know of your suggestion ? Thanks in advance.
    Sincerely,
    Dr.D
     

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