May 13, 2003

Bill Would Change S Corporation Criteria

Thousands of corporations may end up with a much higher tax bill if a new proposal becomes law. The state Senate bill would change the criteria for qualifying as an "S Corporation," a status that significantly reduces corporate tax rates. The bill would prevent large businesses from qualifying as S corporations for state-tax purposes, according to Sen. Jackie Speier, D-Hillsborough, who introduced the bill earlier this year.