Question

An s corporation must possess which of the following characteristics?

a. not more than 100 shareholders.
b. corporation organized in the united states.
c. only one class of stock.
d. all of these.

Answer 1

An S corporation must have not more than 100 shareholders, be organized in the United States, and can only have one class of stock. The correct answer to the characteristics that an S corporation must possess is (d) all of these.

Step-by-step explanation:

An S corporation is a special kind of corporation that is designed to avoid double taxation by having its income taxed only at the shareholder level. To qualify as an S corporation, a company must meet several specific Internal Revenue Service (IRS) requirements, which are as follows:

• It must have not more than 100 shareholders.
• The corporation must be organized in the United States.
• It can only have one class of stock.
• All shareholders must be individuals, certain trusts, or estates and must be U.S. citizens or residents.

Therefore, the correct answer to the question about the characteristics an S corporation must possess is (d) all of these.