Business Ownership Question

[SMR 368]

I moved to the US from Canada almost 5 years ago. During this time I have always held a valid TN visa with the company I work for.

Last year it became clear to me that the company I was working for was in trouble and might go broke. At this time I decided to cut down to part time and start a business with a former co-worker. Since I was under TN status we put the company entirely in his name.

The company I have my TN with is still surviving (not sure how but we are) and I still work for them part time.

Now here's were it gets tricky:

I got married to my USC girlfriend in late September and filed my I-130, I-131, I-485, I-765 etc in late October. So we are basically looking at next year before I get my actual GC and my Employment Authorization should be either very late this year or early next year.

The company I started with my biz partner is now thriving and very profitable. I have not taken any salary from the business and as far as the tax man is concerned it is still entirely owned by my partner.

Because the biz is so profitable we have a major dilemma on our hands, if we business stays completely under my partner's name he will get killed at tax time, so he would like to file the corporation doc's to bring me in as a formal 50/50 partner before the end of the year. He would also like us both to take a dividend before the end of the year as again we haven't taken any salaries to date.

So I have a few questions for the group:

- Can I as TN visa holder with a pending AOS legally own 50% of an American S Corp? (my partner and our attorney don't see why I can't since I would basically just be an investor as I don't actually take any salary from the business)

- Will there be any issues in the GC process if I do take a dividend this year?

I hope this makes sense and hopefully some of you can provide some insight?

What if you put the business in your wife's name? I'm sure she can own part of the business. I suppose this becomes a trust issue depending on how your partner feels about your wife, but it solves your tax problem I think.

[manitoban 0]

I moved to the US from Canada almost 5 years ago. During this time I have always held a valid TN visa with the company I work for.

Last year it became clear to me that the company I was working for was in trouble and might go broke. At this time I decided to cut down to part time and start a business with a former co-worker. Since I was under TN status we put the company entirely in his name.

The company I have my TN with is still surviving (not sure how but we are) and I still work for them part time.

Now here's were it gets tricky:

I got married to my USC girlfriend in late September and filed my I-130, I-131, I-485, I-765 etc in late October. So we are basically looking at next year before I get my actual GC and my Employment Authorization should be either very late this year or early next year.

The company I started with my biz partner is now thriving and very profitable. I have not taken any salary from the business and as far as the tax man is concerned it is still entirely owned by my partner.

Because the biz is so profitable we have a major dilemma on our hands, if we business stays completely under my partner's name he will get killed at tax time, so he would like to file the corporation doc's to bring me in as a formal 50/50 partner before the end of the year. He would also like us both to take a dividend before the end of the year as again we haven't taken any salaries to date.

So I have a few questions for the group:

- Can I as TN visa holder with a pending AOS legally own 50% of an American S Corp? (my partner and our attorney don't see why I can't since I would basically just be an investor as I don't actually take any salary from the business)

- Will there be any issues in the GC process if I do take a dividend this year?

I hope this makes sense and hopefully some of you can provide some insight?

What if you put the business in your wife's name? I'm sure she can own part of the business. I suppose this becomes a trust issue depending on how your partner feels about your wife, but it solves your tax problem I think.

This idea has always been my back-up plan. The issue isn't trust, plus since we are now married before I own any of the biz, it's half hers no matter what if something happens. It's more of a hassle in terms of signing doc's, getting credit cards etc.,

[manitoban 0]

A good CPA may be of more help in answering some of your questions than an attorney. Though it seems that you may have hashed out a lot of it already. Just a thought.

Ummm... he's been talking to one...

Yes I have an excellent CPA, in fact he spends just as much of his time doing forensic accounting for the state so he will only lead us down the safest road possible.

[payxibka 10,045]

A good CPA may be of more help in answering some of your questions than an attorney. Though it seems that you may have hashed out a lot of it already. Just a thought.

Ummm... he's been talking to one...

Yes I have an excellent CPA, in fact he spends just as much of his time doing forensic accounting for the state so he will only lead us down the safest road possible.

actually I was referring to someone else ... but I am glad you have local assistance