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PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4677
Experience:  35 years tax experience, including four years at a Big 4 firm.
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We have a LLC that is a single member. It has ben filed

Customer Question

Hello, We have a LLC that is a single member. It has ben filed under personal tax return. Original company was single member but owner added husband to company including proof in state records. We want to file Late Election Relief, Due to the fact of not knowing that it was best for us to file as multi member. We just found out when we switched CPA. Will this qualify us?
Submitted: 1 year ago via Cornell Legal Info Institute.
Category: Tax
Expert:  PDtax replied 1 year ago.

Hi from Just Answer. I'm PDtax. I'll assist.

Just confirm for me:

The original LLC filing was for a single member, and it filed Schedule C tax reporting at least once

A second member was added to company (when) and you have written proof of the purchase of his interest

You want s corp filing status.

I will assist once you get back to me with these items.


Customer: replied 1 year ago.
Original was a single member and was tax filed on a 1040 Form. Wife was original single member, added husband on 5-2014 on recorded state articles of amendment. They want to file 2015 tax as S Corp and are trying to figure out how? We are worried about deadlines of March 15..
Expert:  PDtax replied 1 year ago.

OK. Can I ask how 2014 was filed?

Also, what advantage do you get for 2015 unless you pay wages? Did you?

I'll look at the regs to see if this qualifies. I'll be back shortly.

Expert:  PDtax replied 1 year ago.

Here's what I found.

Your situation qualifies for relief under the Rev proc, except for the 2014 filing. You might have to go back and request 2014 s status to get relief.

You still have time, it's three years and some days, so you have plenty of time.

I would file extensions for 2015 as an s if you don't decide by Tuesday. They will further show your intent to be an s, which is part of the relief Provision.

Thanks for asking at just answer. Positive feedback is appreciated. I'm PDtax.

Customer: replied 1 year ago.
2014 was filled included in the personal tax return Form 1040. Yes, there has been Payroll since 2014. So you are saying that 2015 qualifies but not 2014?
Expert:  PDtax replied 1 year ago.

Here's my take on your problem.

The change in ownership was in 2014. If you filed as two owners of the business, maybe splitting the schedule C reporting, that's one thing. It sounds like you just filed a 2014 schedule C 100% owned by one spouse.

That does not support the intent portion of the Relief Provision, since your 2014 filing omitted the second owner reporting.

Did either owner get payroll from the business?

Customer: replied 1 year ago.
it was Schedule C for 2014, 100% Proprietor... No, W-2 for neither in 2014.. Started BOTH on Payroll in 2015.
Expert:  PDtax replied 1 year ago.

Then you likely can argue that you treated the business as an s corp for 2015.

Thanks again from just answer. Please rate my assistance to close out your inquiry. I'm PDtax.

Customer: replied 1 year ago.
Do I have to fill out form 2553 for 2015? I'm confused after I file extension my next step?
Expert:  PDtax replied 1 year ago.

You do have to fill out 2553 for 2015.

I would send in an extension as well, treating your LLC as an S corp (since you expect approval).

Thanks again from Just Answer. Positive feedback is appreciated. I'm PDtax.