Tax Law (Questions About Taxes)/S Corp Ownership


Thanks for taking my question John. Short and I'm sure it's not simple but any guidance is appreciated.

Background: I am 51% owner in an S Corp, 2 other owners each with 24.5%. We declared 50,000 shares of stock with no par value when we incorporated. No Stock Certificates were ever issued. However IRS Form 2553 was filed. 2 part question;
Does that AUTOMATICALLY give the 3 owners the corresponding percentage of shares even though no value and no Certificates were issued? 2nd part; the 2 minority owners now want out of the business. I'm sure this answer depends on the first question, so how can the Corp ownership be changed?
As I'm sure you can imagine and have dealt with before, this has turned into a contentious relationship so the level of cooperation and/or agreement is non-existent. One of the minority partners actually file with the Sec. of State to dissolve the corporation, how that's possible as a minority owner is beyond me but I was, temporarily, able to stop the process.
Any guidance/advice you can provide is greatly appreciated. Thanks.


It is not uncommon for physical certificates to not be issued. Lacking such physical evidence, reliance would be placed on such documentary evidence as could be obtained. The entries on 2553 is one such source. Corp ownership is changed by the recording of shares owned on the corporate records.

Hope this helps.

John Stancil, CPA  

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John Stancil, CPA


I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at I also offer seminars and consultations to churches and clergy on their tax issues at Also visit my blog, I am listed on Tax Connections at Prepare and file your own taxes at


I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

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