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aerie1991
Returning Member

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?

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?

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3 Replies

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?

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
Returning Member

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?

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?

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?

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

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