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The main difference between an ESBT and a QSST is that an ESBT may have multiple income beneficiaries, and the trust does not have to distribute all income. Unlike with the QSST, the trustee, rather than the beneficiary, must make the election.

SUMMARY. Both qualified Subchapter S trusts (QSSTs) and electing small business trusts (ESBTs) may hold an interest in an S corporation. A QSST may only have one beneficiary, who is treated as the owner of the S corporation stock held by the trust for which a beneficiary election is made.

Explanation. Qualified subchapter S trusts (QSST) are frequently used as an estate planning tool. These trusts allow holders of subchapter S stock to transfer ownership to a single beneficiary. This is in contrast with an electing small business trust (ESBT), which allows for multiple beneficiaries.

A Qualified Subchapter S Trust, commonly referred to as a QSST Election, or a Q-Sub election, is a Qualified Subchapter S Subsidiary Election made on behalf of a trust that retains ownership as the shareholder of an S corporation, a corporation in the United States which votes to be taxed.

If a qualified subchapter S trust (QSST) owns both S corporation stock and other assets, determining whether the income from the other assets must be distributed to the beneficiary depends on the terms of the trust document.

The main benefit of a QSST is that it is treated as a grantor trust and therefore considered an eligible S corporation shareholder.

To qualify as a QSST, the trust must require that all of the net income be distributed to a single beneficiary. While principal of the QSST may also be distributed to the beneficiary in the discretion of the Trustee, the QSST cannot provide for multiple beneficiaries.

A Qualified Subchapter S Trust, commonly referred to as a QSST Election, or a Q-Sub election, is a Qualified Subchapter S Subsidiary Election made on behalf of a trust that retains ownership as the shareholder of an S corporation, a corporation in the United States which votes to be taxed.

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Keywords relevant to SAMPLE QSST ELECTION

  • elects
  • Pursuant
  • taxpayer
  • II
  • Distributed
  • Termination
  • beneficiary
  • distribute
  • Corpus
  • requirements
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© Copyright 1997-2025
airSlate Legal Forms, Inc.
3720 Flowood Dr, Flowood, Mississippi 39232
Form Packages
Adoption
Bankruptcy
Contractors
Divorce
Home Sales
Employment
Identity Theft
Incorporation
Landlord Tenant
Living Trust
Name Change
Personal Planning
Small Business
Wills & Estates
Packages A-Z
Form Categories
Affidavits
Bankruptcy
Bill of Sale
Corporate - LLC
Divorce
Employment
Identity Theft
Internet Technology
Landlord Tenant
Living Wills
Name Change
Power of Attorney
Real Estate
Small Estates
Wills
All Forms
Forms A-Z
Form Library
Customer Service
Terms of Service
DMCA Policy
About Us
Blog
Affiliates
Contact Us
Privacy Notice
Delete My Account
Site Map
All Forms
Search all Forms
Industries
Forms in Spanish
Localized Forms
Legal Guides
Real Estate Handbook
All Guides
Prepared for You
Notarize
Incorporation services
Our Customers
For Consumers
For Small Business
For Attorneys
Our Sites
US Legal Forms
USLegal
FormsPass
pdfFiller
signNow
airSlate workflows
DocHub
Instapage
Social Media
Call us now toll free:
1-877-389-0141
As seen in:
  • USA Today logo picture
  • CBC News logo picture
  • LA Times logo picture
  • The Washington Post logo picture
  • AP logo picture
  • Forbes logo picture
© Copyright 1997-2025
airSlate Legal Forms, Inc.
3720 Flowood Dr, Flowood, Mississippi 39232