Do I Need to File Both 8832 and 2553?

Do I need to file both 8832 and 2553?
As discussed earlier, it is not necessary to file both Form 8832 for a newly formed entity to elect to be treated as an association taxed as a corporation and Form 2553 to elect S corporation status. Instead, a single election can be made on Form 2553.
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You might be asking if you have to file Forms 8832 and 2553 as a business owner. No, you do not have to submit both forms, is the quick response. Understanding each form’s function and the deadline for filing is crucial, though.

To change your company’s tax categorization, utilize Form 8832, generally referred to as the Entity categorization Election form. When you want to convert your company from a sole proprietorship, partnership, or LLC to a corporation or vice versa, you utilize this form. The S corporation status is not chosen using this form.

On the other hand, Form 2553 is utilized exclusively to elect S corporation status for your company. The S corporation status permits pass-through taxes, in which the business’s income is taxed at the shareholder level rather than the corporate level. For qualified enterprises, this can result in significant tax savings.

Therefore, all that is required to elect S corporation status for your company is the filing of Form 2553. Form 8832 is not necessary for submission.

If you already submitted Form 8832 to change the tax classification of your company and you now want to elect S corporation status, you must submit Form 2553 within a specific amount of time. In most cases, this happens no later than 75 days after the start of the tax year in which you want the S corporation status to kick in.

It is advised that you speak with an experienced tax professional if you are unsure whether your company is eligible for S corporation status or have queries about the filing procedure.

Additional related queries:

How can I obtain a duplicate of my Form 2553?

You can ask the IRS for a copy of your Form 2553 if you need one. You can send a written request by mail or fax, or you can phone the IRS Business and Specialty Tax Line. Include the name of your company, your employer identification number (EIN), and the tax year for which the copy is required.

Can I choose a S corporation for 2021 still?

Yes, you can still choose to have your company be a S corporation for the 2021 tax year. To elect S company status, however, there are specified deadlines that must be met. To make sure you comply with all applicable regulations and timeframes, it is advised that you speak with a certified tax professional.

What constitutes a valid excuse for failing to timely file Form 2553?

You might be able to justify your late submission if you were unable to submit Form 2553 on time due to reasons beyond your control. Illness, death, natural disasters, or other unforeseen situations are a few examples of acceptable causes. In order to prove your claim of probable cause, you must present supporting evidence.

Does the Form 2553 need to be signed in person?

Yes, original signatures are required on Form 2553. The document must be signed by each shareholder and cannot be submitted electronically. The completed form can be sent or faxed to the relevant IRS office.

FAQ
Do you have to file S Corp election every year?

You are not required to file a S Corp election each year. Your S Corporation status will remain up until it is terminated or revoked once you have correctly submitted Form 2553 and it has been accepted by the IRS. It’s crucial to keep in mind, though, that keeping your S Corporation status may require you to submit specific annual tax returns and reports.