S corporation election

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The corporation must make an affirmative election to be treated as an S corporation. That means Form 2553 must be filled and submitted by every stockholder, regardless of the share they have. 

A newly formed corporation or LLC must file an S-Corp election within two months and 15 days about 75 days of the date of formation for the election to take effect in the first tax year. Form 2553 

Example: Your articles of formation were filed on August 21st. Your S-Corp election must be filed by November 5th to take effect in your first tax year. 

 

An existing corporation or LLC can file the election at any time from the first day of your preceding tax year up to two months and 15 days after the start of the applicable tax year.  

That conversion can be with complex tax implications. A consultation with a tax professional is advisable. 

Example: Tax year of January 1st to December 31st.  
The time frame for the S-Corp tax treatment election beginning from 01.01.2021 is 01/01/2020 - 3/15/2021.


Currently, I am an MBA student at EIU. This blog will follow my studies in Corporate taxation

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