A Testamentary Trust Can Be an S Shareholder for Two

question 40

True/False

A testamentary trust can be an S shareholder for two years, beginning on the date the stock transfers to the trust.

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Definitions:

NSF Check

A check that a bank returns without honoring because the account on which it was drawn does not have sufficient funds.

Outstanding Checks

Outstanding checks refer to checks that have been written and recorded in the paying entity's ledger but not yet cashed or cleared by the recipient.

Checks Cleared

The process where bank checks are verified and funds are transferred from the check writer's account to the recipient's account.

Checks Written

Financial documents that instruct a bank to pay the specified amount from the drawer's account to the person or entity named on the check.