dc.contributor.advisor | Simpson, W. Gary | |
dc.contributor.author | Breit, Emily S. | |
dc.date.accessioned | 2013-11-26T08:23:56Z | |
dc.date.available | 2013-11-26T08:23:56Z | |
dc.date.issued | 2009-12 | |
dc.identifier.uri | https://hdl.handle.net/11244/6760 | |
dc.description.abstract | Scope and Method of Study: Banks first became eligible to elect Subchapter S of the Internal Revenue Code in 1997. Subchapter S status provides institutions the ability to maintain limited liability while avoiding double taxation. The earnings flow through to the individual shareholders on a pro rata basis and are taxed only at the individual level. This paper examines the effect conversion to Subchapter S tax status has on commercial banks. A sample of 1,658 banks that convert to Subchapter S from 1997-2004 are analyzed to detect changes in performance that occur due to the conversion to Subchapter S. I use an event study methodology modified to accommodate accounting data. A sample of banks that did not convert to Subchapter S status is matched with the converting banks to control systemic changes. The primary research question is to determine what banks do with the corporate tax savings that result from conversion. | |
dc.description.abstract | Findings and Conclusions: The empirical analysis indicates that the sample banks that convert to Subchapter S increase dividends. Furthermore, the results indicate that Subchapter S banks increase dividends more than the added personal taxes incurred by shareholders as a result of paying taxes on all income, whether distributed as dividends or not. The analysis indicates that banks converting to Subchapter S status reduce some types of small business and agricultural lending, reduce the proportion of earnings retained as capital, and reduce salaries. The analysis supports the conclusion that Subchapter S banks direct the tax benefits of conversion to shareholders rather than increasing the amount of small business and agricultural lending, increasing bank capital, or increasing salaries and benefits. | |
dc.format | application/pdf | |
dc.language | en_US | |
dc.rights | Copyright is held by the author who has granted the Oklahoma State University Library the non-exclusive right to share this material in its institutional repository. Contact Digital Library Services at lib-dls@okstate.edu or 405-744-9161 for the permission policy on the use, reproduction or distribution of this material. | |
dc.title | Implications of Subchapter S tax status for commercial banks | |
dc.contributor.committeeMember | Carter, David | |
dc.contributor.committeeMember | Simkins, Betty | |
dc.contributor.committeeMember | Nabar, Sandeep | |
osu.filename | Breit_okstate_0664D_10544.pdf | |
osu.accesstype | Open Access | |
dc.type.genre | Dissertation | |
dc.type.material | Text | |
dc.subject.keywords | agricultural lending | |
dc.subject.keywords | commercial banks | |
dc.subject.keywords | dividends | |
dc.subject.keywords | small business lending | |
dc.subject.keywords | subchapter s | |
dc.subject.keywords | tax | |
thesis.degree.discipline | Business Administration | |
thesis.degree.grantor | Oklahoma State University | |