"Paul Thomas, CPA" <paulthomascpapc[at]bellsouth.net> wrote in message
news:bGGsj.99023$L%6.94487[at]bignews3.bellsouth.net...
- quote -


Thanks Paul. That is what I was thinking.


Now, for a twist: What about the case where a departing member sells his
share (through the corporation) to a new member (who has passed the
corporations vetting process) and the corporation keeps, say, 10% of the
sales price? Is that 10% income of some sort, or APIC?

thanks.

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"Gil Faver" <rowdy'sboss[at]xxyz.com> wrote
- quote -





not as "profit" to the business. It is however, an increase in capital,
specifically called "additional paid in capital" - which is the amount
received above the stated face amount of each share. So, if the face on the
share is $100, and they sell for $150, then you book stock at $100 and APIC
of $50. Hopefully you get cash, and the corresponding increase in cash is
$150.




--
Paul A. Thomas, CPA
Athens, Georgia

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

a small sportsman's organization (a corporation) redeemed some of its shares
last year and is holding them as treasury shares. When these shares are
sold to new members at a higher price than their redemption, is the "extra"
money treated as profit or an increase in the capitalization of the
corporation?

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >