Getting full control over your files at any moment is important to relieve your everyday tasks and improve your productivity. Accomplish any objective with DocHub tools for papers management and convenient PDF editing. Access, adjust and save and integrate your workflows with other secure cloud storage.
DocHub offers you lossless editing, the chance to work with any formatting, and securely eSign papers without searching for a third-party eSignature software. Get the most from the document management solutions in one place. Consider all DocHub capabilities right now with your free of charge account.
In this tutorial, Jeff Louisville, a staff accountant, discusses how to avoid constructive dividends on shareholder loans for closely held corporations. Shareholders often seek ways to extract profits from their corporations without incurring taxes on distributions, as these are typically treated as taxable dividends. Some opt to classify these distributions as loan repayments to circumvent double taxation. However, the IRS has established criteria to identify bona fide shareholder loans. If a distribution is deemed not to be a legitimate loan repayment during an audit, it can be reclassified as a taxable constructive dividend. To prevent this, shareholders should draft a valid loan agreement that is documented and signed by both parties.
