Filing an S Corp Late Election is simple and often required by the IRS. If you have missed the deadline to save your election, you can still make one. The corporation must qualify for S corporation status and have no other corporate income tax returns filed for that year. You have to explain why you are filing the S Corp late election and include the required documents with your corporation’s tax return. If you are late with filing your S Corp election, it is essential to keep a few things in mind before you file.
The S Corp late election must be filed within 2.5 months of incorporation or the beginning of the business’s tax year. While it’s essential to file the election form as soon as possible, it’s also possible to file it as late as last year. As long as you are prepared to make the necessary changes, filing an S Corp Late Election is easy and will save you time and trouble. If you are not ready to wait until the last minute, you can always make an earlier election by following the steps below.
How to take full advantage:
As the name implies, filing the S Corp Late Election after the regular deadline is not a good idea. You can take advantage of the S Corp late election if you make the proper preparations. However, you must be aware that the deadline is almost impossible to meet. In this case, you should seek the help of an S-Corp attorney who specializes in S-Corps. It’s important to remember that late elections are not automatic. In addition to filing your returns on time, you must also include statements and reports as the revenue procedure requires.
The IRS generally grants this relief if you file in advance. As with any other late filing, you must ensure that the IRS accepts your application for early reduction under the First Time Abatement program.
Submit your tax returns on time:
If you want to make an S corporation late election, you must submit your tax returns on time. You must file your election on time to avoid any late filing penalties. A filing date after the due date of the S Corp will result in a penalty of up to five thousand dollars. A late S Corp Election is essential for the survival of your S-corporation. The IRS may reject it if the corporation fails to make it on time.
If the deadline is missed, the company may qualify for relief. If your election is late, the IRS will not penalize the corporation for late filing. In this case, the corporation may file for First Time abatement. The IRS also offers a statutory relief program. An S Corp Late Election should be done only when you have a legitimate reason for the late filing.
Unless you have a specific reason for late filing, it is best to file your S Corp election on time. After the due date, the IRS will not grant your request. Moreover, it will still reject your request if you fail to meet the deadline. In such a case, an S-Corp can get its private letter ruling. Once your company gets a private letter ruling, it will not pay the penalty. The process is simple and effective.
The IRS is likely to reject an S Corp Late Election. An S corporation could file a late S election without penalty if it filed the proper forms in time. If it does, it will be taxed as a regular business. The S corporation should also file a separate tax return. Its shareholders should also make sure that they file the proper paperwork. If a shareholder does not make the required filing, the IRS will reject the request.