The S-Corporation Additional Participation Act of 2025 increases the maximum number of shareholders allowed in an S corporation from 100 to 250. This change affects small business owners who use the S corporation tax structure, allowing larger groups of investors to participate in these entities while maintaining their favorable tax treatment. The bill amends the Internal Revenue Code and takes effect for tax years beginning after December 31, 2025. No new federal funding is required for this legislation, as it is purely a tax code modification. The change gives growing businesses more flexibility in raising capital and bringing on additional owners without losing their S corporation status.
Take Action
Your position
Add a comment
to comment on this bill.
Annotate the text
Highlight any passage on the Summary or Full Text tab to attach a note. Annotations appear on the Annotations tab.