If you submit Form 2553 after the due date, fines can apply. For every month or portion of a month that a S company election is late, up to a total of 12 months, there is a $195 fine. This fine is in addition to any further fines or interest that might be imposed.
Making a Section 444 election is another choice available to companies. By making this choice, corporations can choose an alternate tax year from the one that follows the calendar year. For businesses having a natural business cycle that doesn’t coincide with the calendar year, this can be helpful. The corporation must submit Form 8716, Election to Have a Tax Year Other Than a Required Tax Year, to the IRS in order to make a Section 444 election.
It’s crucial to keep in mind that not all IRS forms can be handwritten when submitting them. You can handwrite several forms, including Form 1040, the individual income tax return. Other forms, including Form 941, the employer’s quarterly tax return, must be submitted electronically, though. For each form, the instructions should be carefully read in order to ensure proper filing.
The IRS does demand a wet signature on several forms, to sum up. A physical signature that is written in ink is known as a wet signature. Forms like Form 8821, Tax Information Authorization, and Form 2848, Power of Attorney and Declaration of Representative, call for a moist signature. These documents cannot be electronically signed.
In conclusion, even though Form 2553 cannot be faxed, there are still a number of crucial considerations to make. Corporations may think about making a Section 444 election for non-calendar tax years given the potential penalties for filing S corporation elections after the deadline. A wet signature is required on some forms, therefore it’s crucial to read the instructions for each one to make sure it’s being filed correctly.
If you chose to be taxed on the fair market value of restricted stock or other property at the time it was issued to you instead of when it vests, then you must include Form 83(b) with your tax return. Within 30 days after receiving the property, this form must be submitted to the IRS, and a copy must be given to the business awarding the property.