Overview of Form 2553
Form 2553 enables S-corporation election, notifying the IRS you want to be taxed as an S-corporation. This tax status may reduce taxable income. After review, the IRS will confirm or deny the request, which can save small business taxes. The form is due two and a half months after the tax year when the election is intended to take effect.
Filing Process
Filling out Form 2553 involves:
- Provide general information
- Insert required election data like shareholders’ names and addresses
- Define the tax year and tax payment options
- Consent statements and signatures
The IRS typically responds within 90 days; however, approval may take longer if you don’t use the calendar tax year.
Costs and Specific Items
Does it cost money to file form 2553?
What is the item E on form 2553?