topic 2553 and 1120-S HELP! in Get your taxes done using TurboTax

2553 and 1120-S HELP!

paris999 — Thu, 10 Mar 2022 23:52:28 GMT

Couple of questions here.

I downloaded the TurboTax Business Download so that I can create an 1120-S for my LLC business. Here's where things get tricky. My CPA filed an 1120-S for my LLC in 2019 and in 2020, however, he forgot to file Form 2553 to elect for S Corp status. So this whole time we've been mailing in the 1120-S and now IRS says "No Record Found". So technically, my LLC is not yet an S Corp.

Questions:

Does TurboTax Business have a place where I can fill out the 2553 Form?
If not, I am assuming I have to download and print from IRS website. If that is the case, do I mail this in WITH my 1120-S return? Or do I need to mail off the 2553 Form by itself first?
If I must send off the 2553 first, what do I file my LLC as in the mean time? Can I still file an 1120-S?

Please help, thank you so much

Re: 2553 and 1120-S HELP!

MaryK4 — Fri, 11 Mar 2022 00:08:45 GMT

You MUST read the Instructions for Form 2553 (12/2020) CAREFULLY because there are many rules.

General Relief Rules for S Corporation Elections

The following requirements must be met to qualify for late S corporation election relief by a corporation or entity classified as a corporation:

The entity intended to be classified as an S corporation, is an eligible entity, and failed to qualify as an S corporation solely because the election was not timely;
The entity has reasonable cause for its failure to make the election timely;
The entity and all shareholders reported their income consistent with an S corporation election in effect for the year the election should have been made and all subsequent years; and
Less than 3 years and 75 days have passed since the effective date of the election (See the Exception to the 3 Years and 75 Day Rule section below).

In addition, if the electing entity is requesting a late corporate classification election to be effective on the same date that the S corporation election was intended to be effective, the requesting entity must also meet the following additional requirements:

The entity is an eligible entity as defined in Treas. Reg. § 301.7701-3(a);
The entity failed to qualify as a corporation solely because Form 8832 was not timely filed; and
The entity timely filed all required federal tax returns consistent with its requested classification as an S corporation.

See Rev. Proc. 2013-30.

Re: 2553 and 1120-S HELP!

Anonymous_ — Fri, 11 Mar 2022 00:09:10 GMT

You really need a tax professional for this situation.

TurboTax Business does support Form 2553, which you can complete in Forms Mode.

For late elections, you can read through the information at the link below (but seek guidance from a tax professional).

https://www.irs.gov/instructions/i2553#idm139855003794080