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S Corporation Regulations

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  • S Corporation Regulations

    I looked through the entire article on this site about S Corporations and could not find anything that would help answer the following question:

    Is there anything in the S Corporation rules and regulations that outlines when companies are obligated to actually pay dividends they declare?

    Example: As an S corp shareholder in my company, we get our K-1 tax forms in March each year for the previous year, declare the full dividends on our taxes and we receive 30% of the declared dividend for that year to cover our tax liability. As of 4/3/18, I am still owed 70% of my dividend for 2015, 70% of my dividend for 2016 and 100% of my dividend for 2017. The company says they will pay the balance of dividends owed from past years based on 'cash flow'.



  • #2
    Rules relating to S Corporations can be found here: https://www.law.cornell.edu/cfr/text/26/part-1
    There is a lot going on on this page, so I suggest doing a CTRL+F search on the page for: (space) s corp ... if you search with a space before the "s", you should get only the 15 mentions in the TOC with tax rules relating to S Corporations (if you don't include the space, you will get results that include foreign sales corporations, so be sure to include the space before the s.

    You might find more, but a few regulations that might be of interest to you:
    https://www.law.cornell.edu/cfr/text/26/1.1(h)-1
    https://www.law.cornell.edu/cfr/text/26/1.1366-1
    https://www.law.cornell.edu/cfr/text/26/1.1368-1

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