Discussion:S-Corp, Calendar Year To Fiscal Year?
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Discussion Forum Index --> Tax Questions --> S-Corp, Calendar Year To Fiscal Year?
| 17 May 2007 | |
| Is this possible? There is good economic reason behind it. Business was formed over 2 years ago. | |
| 17 May 2007 | |
| Also, a 6/30 year end- would be beyond the allowable deffered period, correct? | |
Corptaxhelp (talk|edits) said: | May 17, 2007 |
| Unless I'm misunderstanding the question, the answer is 'no'. An S corporation must use the calendar year as its fiscal year. Only a C corporation an shift time and space. | |
| 17 May 2007 | |
| Permitted year for S corp includes 1) calendar year 2) fiscal year based on IRS approval of business purpose and 3) fiscal year end of Sept, Oct, or Nov with Sec 444 election. "Beyond the allowable deffered (sic) period" refers to item 3 above, not to item 2. See Rev-Proc 87-32. Whether the IRS will agree with your business purpose or not is uncertain.
http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/cfr_2002/aprqtr/26cfr1.441-4T.htm See also Temp Reg 1.44-3T | |
| 17 May 2007 | |
| I thought the only s corps on a fiscal yr, were the ones grandfathered in when the IRS made all s corps a calendar year many years age. | |
| 18 May 2007 | |
| Jdugan is correct about the 444 election. However, I recommend against making the 444 election since the corporation is required to make a tax deposit whenever this election is made. A better bet would be to use the "business purpose" exception. If more than 25% of the corporation's gross revenues are generated in the last 4 months of the selected year, then there should be no problem selecting that year. For example, many accountants would be eligible to use an April 30 year end. | |
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