Detailed Answer
(d) The requirement is to determine whether a corporation
that has been an S corporation from its inception may have
both passive and nonpassive income, and be owned by a bankruptcy
estate. To qualify as an S corporation, a corporation must
have one hundred or fewer shareholders who are individuals
(other than nonresident aliens), certain trusts, or estates (including
bankruptcy estates). If a corporation has been an S corporation
since its inception, there is no limitation on the amount
or type of income that it generates, and it can have both passive
and nonpassive income.
