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Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 7119
Experience:  Extensive Experience with Tax, Financial & Estate Issues
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Our S corp lost its status as a result of an audit at the

Customer Question

our S corp lost its status as a result of an audit at the end of the calendar year. We are on a a calendar year. I know I need to move to file a form 1120 now, but I don't know how I treat the balance sheet, etc. and the form 1120. DO I just start as if it was a new corp on day 1, or carry through the depreciation, etc. to the new C corp filing ?
Submitted: 1 year ago.
Category: Tax
Expert:  Stephen G. replied 1 year ago.

The corporation balance sheet won't change. Historically you were an S-Corp., and those balances remain in place. You just start filing an 1120 and there are no further pass-through items unless and until you qualify to elect S-Corp status again and you decide to do so. The balances, including accumulated depreciation, all carryforward & you would continue to depreciate your assets using the same depreciation methods & periods you were using, just as if nothing changed.

Expert:  Stephen G. replied 1 year ago.