Have a Tax Question? Ask a Tax Expert
Hello! I am a CPA here to assist you with your tax questions. My goal is to provide you with excellent service today.
If you are a corporation, and never filed an election to be treated as an S Corp then you are by default a C Corp.
You would have filed form 2553 with the IRS to make the election to be an S Corp
Also, you cannot back track and make this a sole proprietorship. You could dissolve the corporation and start a new business, but you can't change the form of this business.
In terms of the other shareholder. All they would need to do is gift you their interest in the business.
Is there a specific form for that?
No, there's no specific form for that, you would just document in your corporate minutes.
So would the 'date of the minutes' matter? Say, if I draft something and have her sign it and it's dated 2013 but I'm filing taxes for 2012 as a corporation and leaving her off of them would that be okay?
One last questions. I'm thinking the answer is 'no', but is it possible to dissolve the C Corp, re-incorporate as a Sole Propreitor and file taxes for 2012 as a Sole Proprietor?
Thank you for your follow up question. The date of the minutes would matter. If she was part owner for 2012 she would be stuck. However, if it's a C Corp she will have no personal tax liability from this.
And no, there's no way to retroactively become a sole proprietor
Okay, thank you.
Is there anything else I can assist you with today?