Some follow-up comments:
- I believe you have some hurdles to cross.
- Since you have never responded to the IRS request, and provided them with a completed form 2553, you technically don't have a valid S election.
- To have a valid S election, the IRS will send you a letter of acceptance.
- Since you have already filed the form 1120-S, I am not sure what stance the IRS will take at this point in time. This needs to be figured out before you file any 2023 returns.
- The IRS could deny the S election. You would then need to amend your 2022 form 1040 and possibly have some issues at the state level as well.
- Many states require a copy of the S corp acceptance letter be attached to the first year state return. You have not done this since you never received acceptance.
- The IRS may accept the S election even though there has been a significant time lapse since their request. If this is the case, then you need to file a final form 1120-S.
- In this case, you will have a complete liquidation of the S corp assets
- You may need to file form 1099-DIV to report liquidating distributions
- You will need to determine gain or loss on the liquidation of the S corp
- You will need to file any final state S corp return
- You need to send back the appropriate signed form 2553 as requested; along with a copy of the letter that was included. The response from the IRS will then dictate the next move.
- Once you receive the response from the IRS, I would then recommend you meet with a tax professional to clean this up and get started down the right path. Don't be penny wise and pound foolish here. Penalties could easily be more than any professional time.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
