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Level 2
posted Mar 16, 2024 11:10:04 AM

I have a S corp that had income in 2022. But last year I lost my consulting engagements and did not produce any income in the corp except interest income. took full time

I have a S corp that had income in 2022. But last year I lost my consulting engagements and did not produce any income in the corp except interest income. took full time job and got a W2 income last year.

Will S corp be materially engaged ? Not sure how I can answer that question. I am 100% owner of the company

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1 Best answer
Expert Alumni
Mar 17, 2024 12:52:37 PM

Yes, you are still materially engaged if you are the sole owner. Report the interest income on the S-Corp return. If you don't plan to continue this business, you may consider dissolving the S-Corp now to avoid having to file business returns in the future.

1 Replies
Expert Alumni
Mar 17, 2024 12:52:37 PM

Yes, you are still materially engaged if you are the sole owner. Report the interest income on the S-Corp return. If you don't plan to continue this business, you may consider dissolving the S-Corp now to avoid having to file business returns in the future.