Question

Process to close my new S Corp before commencing operation

Forum|Forum|2 years ago
February 5, 2024
1 reply
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I recently (04 Jan 2024) opened a single member S Corp (based on advise from CPA on tax benefits), I haven't conducted any business with this S Corp (I'm based in Maryland) yet, so $0 in/out (no asset or anything).

I would like to close this S Corp and open a LLC to keep it simple for my year-end taxes (as I don't want additional overhead that comes with S Corp of running payroll, profit/loss process, board meetings, etc).

What I have now is EIN from IRS, Business Bank accounts and business credit card.

I just want to start clean with new LLC and close the S Corp.

Is it possible for me to elect my current S Corp to be taxed as LLC (a change in status) ? If yes, How would I do that ?
If not, what are the actions I need to take to properly close this S Corp ?
- With state (MD), I see the process is straight-forward, I can apply for dissolution of my company with the state following their process.
- What steps I need to take with IRS for closing my EIN ? (I'm not clear on this).

Not A Product Question

D

DavidD66

Do you have corporation that you elected S-Corp status for, or do you have an LLC that you requested S-Corp status for? You should be able to tell by the name - if it has LLC, Ltd, Limited Liability Company, etc. as a part of the name, its an LLC. If it has Inc., Incorporated, etc. it's a corporation.

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A

arunpselvamAuthor

Thank you checking. It is "Inc"

R

RobertB4444

An S-Corp isn't a type of corporation. It's the way that the corporation is taxed. You have not filed an S-election with the IRS (which is a separate form that is often included with the first year's tax return) so you are not an S-corp yet even though you structured your corporation with the intention of becoming one.

In order to change your simple corporation to an LLC I would advise you to consult an attorney in your area. There should just be a couple of quick documents to file and your company will be changed over.

@arunpselvam

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