Law Commons^™

The Separate Tax Status Of Loan-Out Corporations, Mary Lafrance

Vanderbilt Law Review

When professionals and other persons who offer their goods and/or services to the public conduct their businesses through corporations, the Treasury has acknowledged that for federal income tax purposes it must treat those corporations as separate and distinct from their controlling shareholder- employees, even where there is only a single shareholder-employee, provided that the corporation has a business purpose and the taxpayer consistently respects the corporate form. However, the Treasury has refused to accord equal dignity to incorporated workers who offer their services not to the public at large but to a single recipient or a small number of recipients. …