I was a single member LLC and then mailed form 2553 to be a Scorp. It was accepted by the IRS but I no longer wish to have this status. How do I convert back to LLC?

[aerie1991]

The Scorp status is not for me. I made less than $500 and plan on dissolving the business eventually. I want to go back to being a LLC or atleast not have the Scorp status. How do I convert back? Do I have to do the 1120s in Turbotax Business? or may I continue using the self employed software?

[tagteam]

The election to be treated as an S corporation can be revoked.

See https://www.irs.gov/forms-pubs/revoking-a-subchapter-s-election

To revoke a Subchapter S election/small business election that was made on Form 2553, submit a statement of revocation to the service center where you file your annual return.

The statement should state:

• The corporation revokes the election made under Section 1362(a)
• Name of the shareholder(s),
• Address of the shareholder(s),
• Taxpayer identification number of the shareholder(s),
• The number of shares of stock owned by the shareholder(s),
• The date (or dates) on which the stock was acquired
• The date on which the shareholder's taxable year ends
• The name of the S corporation
• The S corporation's EIN
• The election to which the shareholder(s) revokes
• The statement must be signed by the shareholder(s) under penalties of perjury
• Signature and consent of shareholder(s) who collectively own more than 50% of the number of issued and outstanding stock of the corporation, (whether voting or non-voting)
• Indication of the effective date of the revocation (or prospective date)
• Signature of person authorized to sign return

Due Date of Revocation:

• If revoking effective the first day of the tax year, the revocation is due by the 16th day of the third month of the tax year,
• If revoking effective any day other than the first day of the tax year, the revocation must be received by IRS by the requested effective date.
  • For example, the S corporation is on a December 31 tax year ending and requests a revocation effective January 1, the revocation is due March 15.
  • The S corporation is on a December 31 tax year ending and requests a revocation effective February 14, the revocation is due February 14. 

[aerie1991]

Thank you for response. What does "submit a statement of revocation to the service center where you file your annual return" mean? I normally file with Turbo tax....this statement does not go to the IRS? Please advise.

Also, I may have heard filing as a C corp will have it automatically convert back but I dont know how much of that is true. Thoughts? or is the revocation statement along with form 8832 the best route to take?

[tagteam]

You only have to submit the statement to the service center where you would send your return if you were filing by mail.

See https://www.irs.gov/instructions/i2553#idm139855003343344