To be a close corporation, the business must be small, with no more than 20 owners, trade its stock publicly, and have no more than $500,000 in gross annual income.

Question

Quizplus · Accepted Answer

A close corporation typically does not trade its stock publicly and there are no specific income requirements to be classified as such. The definition mainly involves restrictions on the number of shareholders (often fewer than a certain number, but not specifically tied to gross annual income) and the public trading of shares.

To Be a Close Corporation, the Business Must Be Small