Building on question 1, fast forward 25 years. John has created an incredibly successful wine operation in the Northeast. He has vineyard lands along the Seneca and Cayuga wine trails in the Finger Lakes of New York. Many of his wineries are considered some of the best on the East Coast, and one of them, Jennifer T was recently named winery of the year by Wine Spectator magazine. In all, there are 5 different wineries operations each in a different corporation. All 5 are in a separate S-Corporation with all the stock owned by the parent Company Petosa Vineyards Inc, also an S-Corporation. John and his wife Jennifer own 75% of the stock of the parent Company which means they own 75% of all of the value of the entities. Jennifer and John are each others second marriage. John has three children from his prior marriage and Jennifer has 2 children from her previous marriage. John and Jennifers family have been an important part of the Companys growth. Johns brother, Tom became a partner in the business providing much needed capital when the wineries were in a growth stage. Tom owns 20% of the remaining stock and he has 2 children who work at the winery on weekends doing wine tasting, but have other jobs during the week. Jennifers sister Karen owns the remaining 5% of the outstanding shares. Karen has 3 children, none of which are involved in the wine operations. However, Karen has one son, Stephen, who has an engineering degree from Georgia Tech and has been helpful in development of the winerys bio-dynamic farming operations. Stephen has expressed an interest in becoming a bigger part of the overall operations as he enjoys the laid back lifestyle the winery offers. Jennifer has been the driving force behind the winerys commitment to bio-dynamic, organic farming. She has been in charge of the vineyard operations and overall marketing. Jennifers two sons have also been very involved in the winery operations. Albert received his degree from Syracuse University in Economics and Entrepreneurship. After a few summers working as a landscaper, he learned that he loved to work the land and has been the one to implement his mothers organic farming techniques at the various vineyards. Nino graduated from Syracuse University with a degree in information studies. He has been in charge of the information systems for the wineries. He has also been responsible for the social media and other electronic marketing methods that have catapulted the growth in the companys exports to other states and overseas markets. Only Christopher, of Johns three children has been involved in the wineries. Chris, a graduate of SUs Whitman School of Management with a degree in accounting and the Syracuse College of Law, has been the CFO of the Company and the lead wine maker following in his fathers footsteps. It has been Chris adept touch and penchant for knowing just when to harvest the grapes that has been crucial to the recent accolades received by various wine rating agencies. Jay and Allyson are Johns other two children and although they come and visit the wineries frequently, they are both medical professionals and have never expressed an interest in being a part of the wine business.

Of course, John has been the visionary leader that we have come to expect in a family business leader. He gave up teaching after Chris graduated from undergraduate school to concentrate on the wine business. His combination of accounting and legal knowledge, as well as his many contacts in the business world has been one of the major reasons for the winerys success. His greatest contribution however, is that of winemaker. After much trial and error, he has become one of the best wine makers in the world, owning much of his success to his grandfathers teaching and the assistance of Paul Hobbs, one of the greatest wine makers ever.

All the land is owned by John and Jennifer in separate LLCs. Each LLC charges the respective S-Corporations rent for the use of the land. The rent charged is usually enough to cover the cost of the real estate taxes, insurance and mortgage on the properties. However, 2 of the LLCs have loss carryforwards since they just started operations and the business end of the winery could not afford a fair market rent. The LLCs elected to be treated as partnerships. Jennifer and John have included their children as minority owners of the LLCs.