P holds stock in an S corporation as custodian for her five minor children.For purposes of counting shareholders, the entire family is one shareholder.

Question

Quizplus · Accepted Answer

According to the IRS, for the purposes of counting shareholders in an S corporation, a shareholder who holds stock as a custodian for a minor is treated as a shareholder, but the minor is not counted as a separate shareholder. Therefore, in this scenario, the entire family is considered one shareholder.

P Holds Stock in an S Corporation as Custodian for Her