Suppose CCS had been initially formed an S corporation with a calendar year-end. After a couple of years, things were going so well that Nicole and Sarah (each one-third shareholder) wanted to terminate the S corporation and take CCS public. However, Chance (also a one-third shareholder) was opposed to the S election termination.
Supposed Chance Armstrong is a US resident but a French citizen. His mother has recently been diagnosed with a terminal illness, and Chance has decided to move back to France to take care of his mother and her affairs. He anticipates that he will live in France for several years and that he will no longer be considered a US resident. If you were Sarah and Nicole, how would you react to Chance’s decision to move? Would you ignore the impact it may have on CCS’s corporation status? Would you pressure Chance to sell his CCS stock to you?
Provide support, with proper citations, for your answer.
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