Create an 2553 Form Online Instantly!

Profits and losses from an S Corp are reported by its shareholders on their individual tax returns and taxed at those filers’ marginal rates. When a C corporation pays dividends to its shareholders, it accrues double taxation.

Is the 2553 form online Required for Anyone?

There are requirements that must be met before a small business may file a 2553 form online and choose to register as an S Corporation. Some of these conditions:

• A domestic company or legal entity must be the legal owner of the business.
• A majority of the company’s stockholders must be legal permanent residents of the US.
• A maximum of 100 stockholders is allowed.
• Only natural persons, legal entities, exempt organizations, and limited trusts are eligible to hold shares.
• There can be only one type of stock in the company.

The final criterion is that the company must use or switch to one of the following tax years:

• The fiscal year that concludes on December 31.
• Normal business cycle.
• An instance of Taxation for Property Ownership.
• Year of Assessment Selected Under Section 444.
• A fiscal year of 52 or 53 weeks is tied to the end of one of the years above.
• Any other fiscal year (e.g., a 52-53-week fiscal year) for which the company declares its intent to conduct business.

Some corporations are banned from submitting 2553 forms online. To name a few of these companies:

• A financial organization that keeps a reserve of funds to cover problematic loans.
• A company that has chosen to be classified as a possessions corporation.
• For tax purposes, an insurance firm must comply with Code Chapter L.
• A multinational firm based in the United States.