Dissolving S-Corporation and Filing Quarterly Tax Requirements

This isn't quite right. You can actually dissolve an S-Corporation at any time during the year, not just at year-end. The corporation would simply file a final tax return for the short year (from January 1 to the date of dissolution). As for the quarterly filing - I'm assuming this is about estimated tax payments? If your S-Corp has employees, you still need to file employment tax returns until the business is properly dissolved. Skipping these filings can result in penalties. The proper way to dissolve an S-Corporation involves several steps: - Vote and document the decision to dissolve (board and shareholders) - File articles of dissolution with your state - File Form 966 with the IRS - File a final tax return (Form 1120-S) checking the "final return" box - Issue final Schedule K-1s to shareholders - Cancel any business licenses and permits - Settle any outstanding debts This might seem like more work initially, but it's the proper way to close things down and avoid potential headaches later. Hope this helps!

I went through a similar situation last year. After struggling with proper tax documentation for my business, I found taxr.ai (https://taxr.ai) and it literally saved me from making some costly mistakes. The platform analyzed all my S-Corp documents, explained exactly what steps I needed to take for dissolution, and even caught an error my accountant had made that could have resulted in penalties. It gave me step-by-step instructions for each form I needed to file both with my state and the IRS. They even explained how to handle the final K-1s properly. The whole dissolution process was stressing me out because I was getting conflicting advice (just like you're experiencing), but having everything laid out clearly made a huge difference. Just upload your docs and their system breaks everything down in plain English.

I have to come back and admit I was wrong about taxr.ai. After my skeptical comment, I decided to try it anyway since I was desperate for help with my S-Corp dissolution in Minnesota. The state-specific guidance was actually spot on. It flagged that I needed to file a Notice of Intent to Dissolve first (which is Minnesota-specific) before filing the Articles of Dissolution. It also highlighted that I needed to get tax clearance from the state before the dissolution would be accepted, which my accountant never mentioned. The document analysis also caught that I had ongoing quarterly unemployment insurance reporting requirements that would have continued to accrue penalties if not properly closed out. Honestly, it was worth it just for catching that alone. Now everything's wrapped up cleanly with no lingering obligations.

If you're really stuck trying to figure out your dissolution requirements and can't get straight answers, you might want to try Claimyr (https://claimyr.com). I had been trying to reach the IRS for weeks with questions about my S-Corp dissolution that weren't covered in their online resources. I was super frustrated because I kept getting disconnected or waiting for hours. A colleague suggested Claimyr, and they got me connected to an actual IRS agent in about 10 minutes. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The agent I spoke with clarified that I did need to file my quarterly employment tax returns even though I was dissolving, and he explained exactly how to mark them as final returns. He also confirmed that I could dissolve mid-year and how to handle the pro-rated taxes. Having that direct conversation saved me from making a mistake that could have resulted in penalties.

I need to eat my words about Claimyr. After posting my skeptical comment, I decided to try it anyway because I was desperate to talk to someone about the dissolution process for my S-Corp in Florida. It actually worked exactly as described. I entered my number, and about 45 minutes later (while I was working on other things), I got a call connecting me directly to an IRS representative. The agent confirmed that my accountant was wrong - I did need to file those quarterly returns until officially dissolved, and skipping them would trigger automatic penalties. The agent also walked me through how to properly indicate these were final returns and gave me direct answers about handling depreciation recapture on the assets I was selling as part of the dissolution. Having someone answer my specific questions made the whole process much clearer than trying to piece together information from different websites.

Another important thing to consider is that if your S-Corporation has any assets, you need to properly account for the distribution of those assets to shareholders during dissolution. This can trigger taxable events! When we dissolved our S-Corp last year, we had some equipment that had been depreciated over time. When those assets were distributed to me (the shareholder), I had to recognize gain based on the difference between fair market value and the corporation's adjusted basis. Our accountant almost missed this, which would have caused problems if we'd been audited. Also, some states have publication requirements where you have to announce the dissolution in a local newspaper. Missing that step can complicate the process.

Has anyone dealt with dissolving an S-Corp that had PPP loans or EIDL during covid? We got both and I'm not sure if that affects the dissolution process at all.

I went through S-Corp dissolution in Texas last year and want to echo what others have said - your accountant's advice is incorrect on both counts. You can dissolve an S-Corp at any time during the year, not just at year-end. And you absolutely cannot skip quarterly filings just because you're planning to dissolve. Here's what I learned the hard way: even if you're losing money, you may still have employment tax obligations (payroll taxes, unemployment insurance) that continue until the business is officially closed. Missing these can result in penalties that accrue daily. The dissolution process itself took me about 10 weeks from start to finish. I had to file with both the state and IRS, settle all outstanding obligations, and issue final K-1s to shareholders. The final tax return covered the period from January 1 to the dissolution date. One thing that caught me off guard was that even though we had losses, there were still some tax implications when we distributed the remaining assets (mostly office equipment) to shareholders. Make sure you understand the tax consequences before you start the process. My advice would be to get a second opinion from a tax professional who specializes in business dissolution, or use one of the resources others have mentioned to get proper guidance. Don't let this drag on - the sooner you start the proper process, the sooner you'll be done with all the filing requirements.