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A tax-exempt organization is a business entity that does not have to pay federal income taxes. Nonprofits, which reinvest earnings to support their mission, are eligible to receive tax-exempt status.
If an entity not treated as a corporation has more than one equity owner and at least one equity owner does not have limited liability (e.g., a general partner), it will be classified as a partnership (i.e., a pass-through), and if the entity has a single equity owner and the single owner does not have limited liability protection, it will be ...
Members have liability either for the amount, if any, that is unpaid on the shares they hold, or for the amount they have undertaken to contribute to company assets, in the event that it is wound up. A public limited company. Must have at least seven members. Liability is limited to the amount, if any, unpaid on shares they hold.
A blocker corporation is a type of C Corporation in the United States that has been used by tax exempt individuals to protect their investments from taxation when they participate in private equity or with hedge funds. In addition to tax exempt individuals, foreign investors have also used blocker corporations. [1]
Tax exemption is the reduction or removal of a liability to make a compulsory payment that would otherwise be imposed by a ruling power upon persons, property, income, or transactions. Tax-exempt status may provide complete relief from taxes, reduced rates, or tax on only a portion of items.
Example: John and Mary are United States residents who operate a business. They decide to incorporate for business reasons. They transfer the assets of the business to Newco, a newly formed Delaware corporation of which they are the sole shareholders, subject to accrued liabilities of the business in exchange solely for common shares of Newco.
New York Business Corporation Law section 1104-a, the holders of 20 per cent of voting shares of a non-public corporation may request that the corporation be wound up on grounds of oppression. NY Bus Corp Law §1118 and Alaska Plastics, Inc. v. Coppock , 621 P.2d 270 (1980) the minority can sue to be bought out at a fair value, determined by ...
The person doing business with such an entity, as if it were a limited liability entity or corporation, may later be estopped from arguing that it is not in fact a limited liability entity, in an attempt to reach the assets of the incorporators. For the same reason, defendants who had acted as a corporation will be estopped from denying ...