How is Brightstar Care's Parent company taxed under the Internal Revenue Code?
Brightstar_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company's Parent has elected to be taxed as an S-Corporation under provisions of the Internal Revenue Code. Under those provisions, the Company's Parent does not pay federal income taxes. Instead, the Parent's stockholder is liable for individual federal income taxes on the Parent's combined taxable income.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 117)
What This Means (2025 FDD)
According to Brightstar Care's 2025 Franchise Disclosure Document, the parent company, BrightStar Group Holdings, Inc., has elected to be taxed as an S-Corporation under the Internal Revenue Code. This election has specific implications for how federal income taxes are handled.
As an S-Corporation, BrightStar Group Holdings, Inc. itself does not pay federal income taxes. Instead, the responsibility for these taxes shifts to the parent's stockholder. The stockholder is liable for individual federal income taxes on the parent's combined taxable income. This means the profits and losses of BrightStar Group Holdings, Inc. are passed through to the stockholder's personal income, and they report it on their individual tax return.
For a prospective Brightstar Care franchisee, this information provides insight into the tax structure of the overall Brightstar Care organization. While it doesn't directly impact the franchisee's tax obligations, understanding the financial structure of the parent company can be helpful in assessing the stability and long-term viability of the franchise system.