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Level 2
posted Feb 25, 2025 12:06:44 PM

LLC filing as S-Corp Eligibility on working with EAD

Hello all,

Can we file taxes as S-Corp for the Single member LLC when the LLC owner is working in US with EAD? Or Do we need to have green card for this scenario?

 

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1 Best answer
Level 15
Feb 26, 2025 9:37:32 AM

@scsvel ,  thank you very much for your answers .  Based on these  and generally agreeing with  my colleague @DavidD66 ,  YES you  can indeed   file as S-Corp  ( i.e. single member LLC electing to file a S-Corp ).  I am assuming  that what you are trying to achieve is to have the S-Corp employ you ( as sole employee) and you become a W-2 employee rather than  file a Schedule-C  ( dis-regarded entity ).  Note though that there are wage / remuneration requirements  as an owner/employee of  S-Corp.  

I am sure you have  gone through the rules and regs. of an LLC  vs. Corp ( S in your case ), with an attorney  -- here is a very simple comparison --   S Corporation vs. LLC: Differences, Benefits | Wolters Kluwer

Please also consider  having an awareness of code sections 1361 through 1363

Is there  more I can do for you ?

 

Namaste ji

 

pk

 

6 Replies
Level 15
Feb 25, 2025 12:17:13 PM

@scsvel ,  Before one can answer this , we need more information on the  NRA with EAD.

(a) NRA citizenship ( for  Treaty assertions ) and in the US with which visa  ( F, Q, J, ?? )?

(b) Which state is the S-Corp registered in ?

(c) EAD tells you what you can and cannot do  ( for the entity/institution that  sponsored you  ) or  through the category code -- so what code  do you have  ?

 

 

I will circle back once I hear from you ?

Level 2
Feb 26, 2025 3:20:58 AM

@pk please find the answers below. 

 

(a) NRA citizenship ( for Treaty assertions ) and in the US with which visa ( F, Q, J, ?? )?

[ Indian citizen and working with Green card based EAD as GC is filed and pending Adjustment of Status. Before that worked with H1B on W2 FTE]

 

(b) Which state is the S-Corp registered in ?

[ It's Pennsylvania ]

 

(c) EAD tells you what you can and cannot do ( for the entity/institution that sponsored you ) or through the category code -- so what code do you have ?

[ This is self petioned category and no employer sponsored. EAD issued based on Pending Adjustment of Status]

 

Thanks.

Expert Alumni
Feb 26, 2025 7:19:16 AM

You don't have to have a green card to be an S-Corp Shareholder.  If the owner of the single member LLC qualifies a resident under the Internal Revenue Code an S-Corp election can be made.  

 

According the AICPA publication "The Tax Advisor":

 

One requirement for an S corporation is that it cannot have a nonresident alien as a shareholder (IRC Sec. 1361(b)(1)(C)). IRC Sec. 7701(b)(1)(B) defines a nonresident alien as an individual who is neither a citizen nor a resident of the United States within the meaning of IRC Sec. 7701(b)(1)(A).  IRC Sec. 7701(b)(1)(A) provides that an alien individual is treated as a resident of the United States with respect to any calendar year if (and only if) that individual either 

 

  • (1) is a lawful permanent resident of the United States at any time during that calendar year (the green card test); 
  • (2) meets the substantial-presence test of Sec. IRC 7701(b)(3); or 
  • (3) makes the first-year election provided in Sec. IRC 7701(b)(4).

Level 15
Feb 26, 2025 9:37:32 AM

@scsvel ,  thank you very much for your answers .  Based on these  and generally agreeing with  my colleague @DavidD66 ,  YES you  can indeed   file as S-Corp  ( i.e. single member LLC electing to file a S-Corp ).  I am assuming  that what you are trying to achieve is to have the S-Corp employ you ( as sole employee) and you become a W-2 employee rather than  file a Schedule-C  ( dis-regarded entity ).  Note though that there are wage / remuneration requirements  as an owner/employee of  S-Corp.  

I am sure you have  gone through the rules and regs. of an LLC  vs. Corp ( S in your case ), with an attorney  -- here is a very simple comparison --   S Corporation vs. LLC: Differences, Benefits | Wolters Kluwer

Please also consider  having an awareness of code sections 1361 through 1363

Is there  more I can do for you ?

 

Namaste ji

 

pk

 

Level 2
Feb 26, 2025 11:24:50 AM

@pk @DavidD66 Just to confirm some related things.

 

Can I file form 8832 and 2553 now to change the election for tax year 2024 and file taxes as S-Corp for 2024? or Only I can do it for 2025 when I file next year?

 

Employee Tax Expert
Mar 5, 2025 6:02:54 AM

You can file 2553 and 8832 with your timely filed 1120-S for 2024.  You need to get it all submitted by March 15th and you may have to mail in the return with signatures on all of the forms.

 

@scsvel