How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Lev Your Own Question
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29965
Experience:  Taxes, Immigration, Labor Relations
Type Your Tax Question Here...
Lev is online now
A new question is answered every 9 seconds

My client's company is a Corp. He is filing form 2553 to become

Customer Question

My client's company is a Corp. He is filing form 2553 to become an S-Corp,and they ask how many shares have been issued and his response is that he has not issued any stock. But the state and IRS does not accept that. I said that when he became a C-Corp he was issued stock. He said that it was not issued. I said when you become a C-Corp you are automatically issued stock. He says that he has not issued any. What is the answer for how many shares were issued on form 2553?
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.
When the corporation was created or the tax treatment was selected as a corporation - whether that C-corporation or S-corporation - there are must be shares - so you are correct.
Expert:  Lev replied 1 year ago.
In some situations - when corporations are register - the number of shares are not explicitly mentioned - but instead shareholder ownership is identified as a percentage of total ownership.In this case - we may assume that corporation has 100 shares.In your case - when there is only ONE shareholder - you still may identify 100 shares - or you may state ONE share that identifies the ownership.That will be accepted by the IRS and will not create any issues with tax filing..I appreciate if you take a moment to rate the answer.Experts are ONLY credited when answers are rated positively.If you still have any doubts, need clarification - please be sure to ask.I am here to help you will all tax related issues.