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I have an 1120S corporation. We received equity for services rendered. We sold the shares and now I'm wondering how to treat the sale for tax purposes?


The BIDaWIZ Team's Answer:

This question falls under IRC Section 83, "Property transferred in connection with the performance of services." In this case, the character of the transaction as occurring in a trade or business would dictate the proper tax treatment as ordinary income. The sale would not be treated as a capital gain.

The BIDaWIZ Team



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