California Minutes of Special Meeting of the Board of Directors of (Name of Corporation) to Adopt Stock Ownership Plan under Section 1244 of the Internal Revenue Code

• Category: Corporations - Minutes and Resolutions
• State: Multi-State
• Control #: US-1077BG
• Format: Word; Rich Text

Description

Section 1244 of the Internal Revenue Code is the small business stock provision enacted to allow shareholders of domestic small business corporations to deduct a loss on the disposal of such stock as an ordinary loss rather than as a capital loss, which is limited to only $3,000 annually. Normally, stock is treated as a capital asset and if disposed of at a loss, the loss is deducted as a capital loss. The general rule for net capital losses (losses that exceed gains) is that they are subject to an annual deduction limit of only $3,000. Any excess over $3,000 must be carried over to the next year. A loss on Section 1244 stock is deductible as an ordinary loss up to $50,000 ($100,000 on a joint return, even if only one spouse has a Section 1244 loss).

Title: California Minutes of Special Meeting of the Board of Directors of (Name of Corporation) to Adopt Stock Ownership Plan under Section 1244 of the Internal Revenue Code Keywords: California, Minutes of Special Meeting, Board of Directors, Stock Ownership Plan, Section 1244, Internal Revenue Code Date: [Insert Date] 1. Introduction The purpose of this document is to provide a detailed description of the California Minutes of Special Meeting of the Board of Directors of (Name of Corporation) to Adopt a Stock Ownership Plan under Section 1244 of the Internal Revenue Code. This meeting is held to discuss and approve the implementation of a stock ownership plan meeting the qualifications set forth by Section 1244. 2. Overview of (Name of Corporation) BRIEF DESCRIPTION of (Name of Corporation), emphasizing its position, importance, and background in the relevant industry. Highlight any noteworthy achievements, unique aspects, or fiscal year statistics where applicable. 3. Introduction to Stock Ownership Plan Providing an explanation of the concept of a stock ownership plan and its significance to the corporation. This plan allows certain shareholders to receive favorable tax treatment under Section 1244 of the Internal Revenue Code, encouraging investment in small businesses. 4. Compliance with Section 1244 of the Internal Revenue Code Discussing the key provisions, requirements, and benefits of complying with Section 1244. Highlight the eligibility criteria, limitations, and tax advantages for shareholders who qualify. Emphasize the importance of adopting a stock ownership plan that adheres to these regulations. 5. Special Meeting Agenda Outlining the agenda items to be discussed during the special meeting. These potential topics may include: a. Call to order and establishment of quorum b. Reading and approval of the notice of the meeting c. Proposal and discussion of the adoption of the stock ownership plan under Section 1244 d. Detailed presentation of the stock ownership plan, its objectives, terms, and eligibility criteria e. Open discussion, questions, and clarifications regarding the plan f. Vote on the adoption of the stock ownership plan g. Appointment of the necessary officers or committees for implementing and overseeing the plan h. Any other business 6. Stock Ownership Plan Documentation Mentioning the vital documents and exhibits that will accompany the Minutes of the Special Meeting, including the Stock Ownership Plan document, amendments to the bylaws, or any other supporting materials. 7. Meeting Attendance and Voting Recording the names of directors present, absent, and any proxy holders. Detailing the voting procedure and the board's decision regarding the adoption of the stock ownership plan. 8. Concluding Remarks Summarizing the outcome of the meeting, highlighting the approval of the stock ownership plan under Section 1244. Expressing gratitude for the directors' participation and reiterating the importance of compliance with the Internal Revenue Code. Additional Types: There can be variations of this meeting based on the purpose, scope, or specific requirements of the corporation. Some possible variations might include: — California Minutes of Special Meeting of the Board of Directors of (Name of Corporation) to Amend Existing Stock Ownership Plan under Section 1244 of the Internal Revenue Code — California Minutes of Special Meeting of the Board of Directors of (Name of Corporation) to Establish Stock Ownership Trust under Section 1244 of the Internal Revenue Code Note: The variations above are hypothetical and meant only to showcase potential alternatives.