Fillable Form 2553 IRS
Form 2553 IRS is a form that a small business owners files when to be treated as an S-corporation for tax purposes.
What is Form 2553?
IRS Form 2553 is used by business entities to elect to be taxed as an S corporation. The form must be filed with the IRS within 75 days of the date the business entity was formed or changed its structure to become an S corporation.
Businesses that file Form 2553 are generally small businesses that have chosen to be taxed as an S corporation to avoid double taxation. S corporations are only taxed once, at the corporate level, on their income. This is different from C corporations, which are taxed twice, once at the corporate level and again at the shareholder level when dividends are distributed.
Form 2553 must be filed by all business entities that wish to elect to be taxed as an S corporation. This includes corporations, partnerships, and limited liability companies. The form must be filed within 75 days of the date the business entity was formed or changed its structure to become an S corporation.
Businesses that file Form 2553 will be taxed as an S corporation beginning on the first day of the tax year for which the election is effective.
The IRS requires all businesses that file Form 2553 to have 100 or fewer shareholders. Shareholders can be individuals, corporations, partnerships, estates, trusts, or certain other business entities. In addition, all shareholders must be U.S. citizens or residents, and they must consent to the election.
Businesses that file Form 2553 will be required to file an annual tax return on Form 1120-S. This return is used to report the income and expenses of the business and to calculate the taxes owed.
There are some restrictions on businesses that can elect to be taxed as an S corporation. For example, businesses that engage in certain types of business activities, such as banking, insurance, or investing in real estate, are not eligible. In addition, businesses that have more than 100 shareholders are not eligible.
If you are thinking of electing to have your business taxed as an S corporation, you should consult with a tax advisor to discuss whether it is the right choice for your business.
What is the purpose of Form 2553?
There are several purposes for Form 2553:
If you wish to elect to have your business taxed as an S corporation, you must file Form 2553 with the IRS. The form must be filed within 75 days of the date the business entity was formed or changed its structure to become an S corporation.
How do I know if I am eligible to file Form 2553?
To be eligible to file Form 2553, your business must meet the following criteria:
If your business meets all of the above criteria, you can file Form 2553 to elect to have your business taxed as an S corporation. Be sure to consult with a tax advisor to discuss whether this is the right choice for your business.
How to fill out Form 2553?
Follow the instructions below to complete Form 2553 accurately and correctly.
Form 2553 consists of four parts. The parts are as follows:
Part 1
Name
Enter the name of your business or entity.
Number, street, and room or suite no.
Enter the number, street, and room or suite number of your business or entity.
City or town, state or province, country, and ZIP or foreign postal code
Enter the city or town, state or province, country, and ZIP or foreign postal code of your business or entity.
Item A. Employer Identification Number
Enter your Employer Identification Number (EIN).
Item B. Date Incorporated
Enter the date your business was incorporated.
Item C. State of Incorporation
Enter the state where the incorporation was incorporated.
Item D
Mark the applicable box or boxes if the corporation or entity, after applying for the EIN show A above, changed its name or address.
Item E
Enter the date of the election using the mm/dd/yyyy format.
Item F
Mark the box that applies to the S-Corporation's selected tax year. Please note that if Box 2 or Box 4 is selected, you must report the other necessary information needed about the selected tax year and accomplish Part 2 of Form 2553.
Item G
If more than one hundred shareholders are listed for Item J in Part 2, mark this box if treating members of a family as one shareholder results in no more than one hundred shareholders.
Item H
Enter the name and title of officer or legal representative whom the IRS may call for more information and telephone number of officer or legal representative.
Item I
Enter an explanation for the reasons the election or elections were not made on time and a description of your diligent actions to correct the mistake.
Signature of Office
Affix your signature.
Title
Enter your job title.
Date
Enter the date you accomplished the form.
Name
Enter the name of your business or entity.
Employer Identification Number
Enter your Employer Identification Number.
For the table in Part 1, you must provide the following information for each shareholder or former shareholder:
Name
Enter the name of your business or entity.
Employer Identification Number
Enter your Employer Identification Number.
Part 2
Item O
Mark the applicable box to indicate whether the corporation is:
1 — A new corporation adopting the tax year entered in item F, Part I.
2 — An existing corporation retaining the tax year entered in item F, Part I.
3 — An existing corporation changing to the tax year entered in item F, Part I.
Item P
Complete Item P if the corporation is using the automatic approval provisions of Rev. Proc. 2006-46, 2006-45 I.R.B. 859, to request (1) a natural business year or (2) a year that satisfies the ownership tax year test. Mark the applicable box below to indicate the representation statement the corporation is making.
1 — Natural Business Year
2 — Ownership Tax Year
If you do not use item P and the corporation wants a fiscal tax year, complete either Item Q or R.
Item Q
Mark Q1 to request a fiscal tax year based on a business purpose. If the IRS proposes to disapprove the requested fiscal year, you can decide if you want a conference with the IRS National Office by marking the Yes or No box.
Mark Q2 to show that the corporation intends to make a backup section 444 election in the event the corporation’s business purpose request is not approved by the IRS.
Mark Q3 to show that the corporation agrees to adopt or change to a tax year ending December 31 if necessary for the IRS to accept the election for S corporation status for certain situations.
Item R
Mark R1 to show that the corporation will make a section 444 election to have the fiscal year shown in Item F of Part 1 when applicable.
Mark R2 to show that the corporation agrees to adopt or change a tax year ending December 31 if necessary for the IRS to accept this election for S corporation status in the event the corporation is ultimately not qualified to make a section 444 election.
Name
Enter the name of your business or entity.
Employer Identification Number
Enter your Employer Identification Number.
Part 3
Income beneficiary’s name and address
Enter the beneficiary’s full legal name and address.
Trust’s name and address
Enter the trust’s legal name and address.
Social security number
Enter the beneficiary’s SSN.
Employer identification number
Enter the trust’s EIN.
Signature of income beneficiary or signature and title of legal representative or other qualified person making the decision
Affix the signature of the appropriate person.
Date
Enter the date you accomplished the form.
Part 4
This part is not fillable.
Relief for a late S-Corporation election must include the following representations:
1 — The requesting entity is an eligible entity as defined in Regulations section 301.7701-3(a);
2 — The requesting entity intended to be classified as a corporation as of the effective date of the S-Corporation status;
3 — The requesting entity fails to qualify as a corporation solely because Form 8832, Entity Classification Election, was not timely filed under Regulations section 301.7701-3(c)(1)(i), or Form 8832 was not deemed to have been filed under Regulations section 301.7701-3(c)(1)(v)(C);
4 — The requesting entity fails to qualify as an S-Corporation on the effective date of the S-Corporation status solely because the S-Corporation election was not timely filed pursuant to section 1362(b); and
5a — The requesting entity timely filed all required federal tax returns and information returns consistent with its requested classification as an S-Corporation for all of the years the entity intended to be an S-Corporation and no inconsistent tax or information returns have been filed by or with respect to the entity during any of the tax years, or
b — The requesting entity has not filed a federal tax or information return for the first year in which the election was intended to be effective because the due date has not passed for that year’s federal tax or information return.