topic Started California single member LLC in 2020. Registered as S-corp with IRS. Income 35K. Will be closing LLC in 2020. Do I have to file 1120/use "business" turbotax? in Business & farm

Started California single member LLC in 2020. Registered as S-corp with IRS. Income 35K. Will be closing LLC in 2020. Do I have to file 1120/use "business" turbotax?

adm — Sun, 07 Mar 2021 20:31:44 GMT

Have about 20 K expenses but not worried about getting benefits of dividents with S-Corp vs 1040 schedule C as a single proprietor. I had both ways from CPAs and intuit: must do 1120 or could just do 1040 schedule C.

Re: Started California single member LLC in 2020. Registered as S-corp with IRS. Income 35K. Will...

ErnieS0 — Sun, 07 Mar 2021 20:51:49 GMT

Yes. The IRS says you must file a Form 1120-S if you elected to be an S-Corp, the election has been accepted and the election remains in effect.

Further, if you elected to be an S-Corp you can no longer file as a Schedule C disregarded entity. I’m assuming you were not a sole proprietor in this business before becoming an S-Corp or afterwards. If that were the case, you might have file both a Schedule C for the period prior to the acceptance of your S-Corp election and after you closed your S-Corp and Form 1120S for the time between.

If you are opening and closing your S-Corp in the same year, check the beginning and “final return” boxes on Form 1120S.

Re: Started California single member LLC in 2020. Registered as S-corp with IRS. Income 35K. Will...

adm — Sun, 07 Mar 2021 21:02:32 GMT

Correct, it is a brand new LLC , opened in Jan 2020 and also applied for S-Corp in Jan 2020.

Re: Started California single member LLC in 2020. Registered as S-corp with IRS. Income 35K. Will...

JeffreyR77 — Mon, 08 Mar 2021 20:27:07 GMT

If the LLC was formed in January and was granted S-Corp as of January, you only need to file the 1120-S return.

In TurboTax Business you want to be sure to indicate you started on January 1st and that you closed the business in 2020 as well.

TurboTax Business will ask you questions about Form 2553, which is the S-Corp election you filed. You do not need to file it again with this return.