Section 28 Accumulated EarningsPersonal Holding Company Status

• Library: Bus Trans 2005

The retention of sale proceeds at the corporate level without continuation of an operating business could result in imposition of an accumulated earnings tax. I.R.C. §§ 531–537. Alternatively, if the shareholders were able to qualify the corporation as a personal holding company, it would not be subject to the accumulated earnings tax. There would, however, be a double tax on income generated by investments, once at the corporate level and again at the shareholder level upon distribution of the income...