qbteachmt
Level 15

What C Corp is this?

An S Corp whose shares are sold between the two individuals, doesn't change the S Corp. It didn't have a short year. It stays operating.

For this: "as the new stockholder did not actually contribute cash to the corp?"

Whether or not an infusion of cash was needed, is not related to the sale. It's a separate issue.

Let's pretend you are operating a The UPS Store franchise, running as an S Corp. You can sell your corporation to me by selling the shares; or, you can decide to sell the operation to me (assets and liabilities), but I need to form my own entity for purposes of running a business. And neither of these has anything to do with if there are not adequate funds on hand for operating needs.

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