Is the initial starting investment in a corporation considered income for tax purposes?
Posted on August 26, 2008 by admin
Rezand asked:
For example, let’s say someone starts a C Corporation “Blahville, Inc” and initially funds the corporation with $3000 for 100% stake. Is the $3000 reported as income for the corporation? How is it tracked?
For example, let’s say someone starts a C Corporation “Blahville, Inc” and initially funds the corporation with $3000 for 100% stake. Is the $3000 reported as income for the corporation? How is it tracked?
No it is just capital on the corporate balance sheet. It is also your cost basis for your company stock. When you sell your stock later the profit will be long term capital gain.