J.K. Lasser's Small Business Taxes 2017

APPENDIX C Checklist of Tax-Related Corporate Resolutions

If you own a corporation (whether it is a C or S corporation), it is important to keep good records on actions taken by shareholders and/or your board of directors at their meetings. The reason: If your corporation fails to act like a corporation, creditors can “pierce the corporate veil” and hold you personally liable. Retain these records in the corporate minutes book.

The following is a listing of key votes that should be taken for tax actions. Some apply only to C corporations, while others apply to both C and S corporations.

• Adopting a fiscal year.

• Adopting an accounting procedure for the de minimis safe harbor rule (see Chapter 14).

• Adopting any of the following employee benefit plans:

  • Accountable plan.

  • Adoption assistance plan.

  • Deferred compensation plan.

  • Cafeteria plan.

  • Educational assistance plan.

  • Employee stock ownership plan (ESOP).

  • Group legal services plan.

  • Medical reimbursement plan.

  • Qualified retirement plan.

  • Stock option plan.

• Authorizing a sale/leaseback transaction.

• Authorizing compensation and bonuses to employees (including shareholder-employees) and payments to corporate directors. To justify larger compensation to C corporation shareholder-employees, note in the minutes why the payment is reasonable under the circumstances (e.g., the payment reflects a catch-up for years in which little or no compensation was paid). Also, if desired, include a resolution requiring officers to repay excess compensation ...