Before you can make the switch, you will need to make sure the new corp is not just formed but has tax exempt status. To obtain that status you have to make a filing with the IRS and get a specific approval. This is a fairly extensive filing and I recommend that you have an attorney help you with the preparation.
Once the new entity is formed, you can remove the S Corp. from the deed on the land and building and create a new lease for the non profit. The employees can be moved over to the new company by starting a new payroll. However, if you have employee beneifit plans such as 401K or profit sharing where some employees are not fully vested, you have to effectively merge the old into a new plan to avoid having everyone's plan become 100% vested. Again, you should consult with an attorney on these issues to avoid unintended consequences.
Existing contracts will have to be assigned to the new company. You will need the approval of the contracting agencies to make such an assignment. Before you take any action in this regard you need to discuss your plans with the contracting parties.
With respect to all other assets, you want to contribute them to the new corporation and take a charitable deduction. You also want to be sure that the income from the lease is sufficient to deal with the IRS issues. You need to work out a payment plan with the IRS
to avoid any claim of a fraudulent conveyance.
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