Can You Reverse an S Corp Election?

Revoke S Corporation Election

To revoke a Subchapter S election, 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) and The S corporation’s EIN.

Consequences of Revoking S Corp Election

If its S election is revoked, the entity reverts to being a C corporation for tax purposes, unless it makes a subsequent election to be taxed as a partnership or LLC.

Entity Classification Election Revocation

Under the IRS procedure, the taxpayer may submit a request to withdraw the election by the 2020 return due date. Once revoked, the entity’s status reverts to its default classification.

Changing from S Corp to Sole Proprietorship

File dissolution documents. Transfer corporate assets and liabilities to yourself.

Retroactive Revocation of an S Corporation Election

There are over 100 stockholders. Stock is held by a non-US citizen. An LLC or corporation holds shares.

Revocation Statement for S Corp

A revocation statement must contain: A statement that the corporation is revoking its Subchapter S election under Section 1362(a).

3-Year Rule for S Corp Election

To revoke a Subchapter S election, submit a statement to the service center where you file your annual return. The statement should state the corporation revokes the election made under Section 1362(a) and the S corporation’s EIN.

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