Deadline for Electing S-Corp Status -- What does it mean?
Got a new gig as a contractor, and I am considering forming an S-Corp for various reasons.
I have seen a few references to the deadline for electing S-Corp status being March 15th. One example:
smallbiztrends.com/2012/02/s-corp-deadline-approaches.html
If your business is a corporation, you’re already aware that March
15th is the most critical tax deadline of the year. But March 15th is
an important deadline for another reason…it’s the deadline for
electing S Corporation status.
What I don't understand is, what does this mean? Since that date is past for 2013, I must operate as a sole proprietor until next year?
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No, the deadline is for existing LLC/C-Corp to chose to be taxed as a S-Corp for the tax year 2013. You haven't form a corporation at all, so its irrelevant for you.
Once you do form your corporation (i.e.: file the relevant documents with your State agency responsible - Secretary of State/Department of Corporations etc), you have 75 days to have the election made (by filing IRS form 8832).
Consider having a consultation with a CPA/EA and a lawyer (which I'm neither of) about whether you really need it. For most cases LLC will suffice. Some professionals aren't allowed to operate under LLC in some states, though.
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