How to pay no federal taxes-subchapter S corp.

According to Crain's NY Business, Newsday's becoming a 'subchapter S corporation' makes it exempt from federal taxes:

• "In the first half of this year, the drop in revenue deepened, falling by 11%, or $27 million, to $226 million. Earnings, however, went the other direction,

as Newsday returned to profitability, posting net income of $127 million.

• That profit, however, was attributable to a one-time $148 million gain achieved by

• converting the newspaper to what’s known as a subchapter S corporation.

Such entities are exempt from federal taxes. Excluding the one-time gain, the paper recorded a $14 million operating loss.

• Even analysts who thought the Dolans were ill-advised to buy Newsday seemed taken aback. The filing “illustrates how bad an acquisition Newsday was” for Cablevision, wrote Pali Research analyst Richard Greenfield in a client report."

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