A simple way to promote worker owned firms in our tax code

Josiah Neeley ask me how I thought corporations like this one could be promoted through policy.

A relatively simple way would be to extend eligibility for S corporation status to firms with over 100 shareholders, so long as:

1) The majority of shareholders are employees; and
2) The majority of employees are shareholders.

(Of course these conditions could be tweaked, so that the requirements might be two-thirds and two-thirds, for instance.)

Such companies would face no corporate taxation.


  1. That sounds like an absolutely brilliant idea!