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New Member
posted Jan 30, 2025 10:26:30 PM

For S-Corp business filing 1120-S, My start date is 03/16/2024, but I cannot enter start-up cost deductions because it says this is not my first year doing business.

Start date 03/16/2024 Incorporation date 02/13/2024 S-corp election date 03/14/2024

0 5 2990
5 Replies
Level 15
Jan 30, 2025 11:29:08 PM

the issue is that you were a c-corp from 2/13/2024 until your S-corp election was effective on 3/14/2024.

thus it would seem all start-up costs would be C-corp costs. 

 

item E on the 2553 should have been 2/13/2024

technically you are supposed to file a C-Corp return for the period 2/13-3/13

 

from 1120 instructions Who Must File
Unless exempt under section 501, all domestic corporations
(including corporations in bankruptcy) must file an income tax

return whether or not they have taxable income.

 

I don't have a solution for your issue. 

perhaps others will have different opinions on how to resolve this issue 

New Member
Jan 31, 2025 10:47:40 AM

That does not make sense, since the S-Corp election was made prior to March 15th wouldn't it be retroactive? per https://www.irs.gov/instructions/i2553

Level 15
Jan 31, 2025 1:17:48 PM

On your Form 2553 you filed, what date did you enter on line "E"?

New Member
Jan 31, 2025 1:23:56 PM

I entered 02/13/2024, and I just found the letter of confirmation from the IRS that states I am recognized with S-Corp status as of 2/13/24, so I just made all the dates in turbotax 2/13/24 and now it's fine... But even if I had not done that, my dates entered were prior to 3/15/24, technically I feel like it should have let me and still be retroactive according to the IRS instructions.

Level 15
Jan 31, 2025 1:27:17 PM

The election CAN be retroactive, but when you told TurboTax 3/16/24, you indicated you CHOOSE that date to NOT be retroactive to the incorporation date.