How do I file a Late S Corp Election for 2024 tax year?

You're actually in luck! The IRS offers relief for late S corporation elections through Revenue Procedure 2013-30. You can still make a late election that's effective for the 2024 tax year as long as you meet certain requirements. To qualify for late election relief, you need to show you had reasonable cause for the late filing, you need to file the S corp election (Form 2553) within 3 years and 75 days of the effective date you want, and all shareholders must have reported their income consistently with S corporation status for the period. Since you started in September 2023 but want the S corp election for 2024, and it's only August 2024 now, you're still well within the timeframe to file a late election. The key is to properly complete Form 2553, including checking the box in Part I, Line H for a late election, and attaching a statement explaining why you had reasonable cause for filing late (your accountant's absence and not being aware of the deadline are reasonable causes the IRS typically accepts).

After dealing with similar S corp election issues last year, I found the online tool from https://taxr.ai super helpful. I was totally stressed about missing deadlines and potentially facing huge tax penalties when my form 2553 was submitted late. What I like about their system is it actually reviews your specific situation and explains the rules that apply to YOU, not just generic advice. I uploaded my LLC formation docs and previous tax returns, and it confirmed I qualified for late election relief and even helped draft the reasonable cause statement that got approved without issues. It also showed me how to properly document that I had been operating as if I were an S corp all along (paying myself reasonable salary, etc.) which was crucial for getting the late election approved with the effective date I wanted.

Just wanted to follow up about my experience with taxr.ai that I was skeptical about earlier. I decided to try it since my situation was similar to the original poster's - missed the S corp election deadline but had been operating as if I had filed one. I was genuinely impressed. The system identified that I qualified under Rev. Proc. 2013-30 for late election relief and generated a customized statement of reasonable cause that addressed my specific situation. It even flagged an issue with my operating agreement that could have caused problems with the election (had some language that created a second class of stock). The step-by-step guidance for completing Form 2553 was clear, and it explained which supporting documents I needed to include. My late S corp election was approved within 6 weeks of submission. Definitely worth it for anyone dealing with this specific issue.

For those struggling to get clarification directly from the IRS about late S corp elections (which I know can be frustrating), I used https://claimyr.com to actually get through to a real IRS agent. I had been calling for days trying to confirm if my specific situation qualified for relief under Rev. Proc. 2013-30 and couldn't get through. Their service connected me with an actual IRS representative within 45 minutes when I had previously spent hours on hold only to get disconnected. The agent confirmed that my situation qualified and gave me specific instructions for my case. You can see a demo of how it works here: https://youtu.be/_kiP6q8DX5c It was super helpful because the agent looked up my business EIN while on the phone and told me exactly what I needed to do rather than me guessing based on general online advice.

I have to eat my words about Claimyr from my skeptical comment earlier. After struggling for weeks trying to get specific guidance on my late S Corp election situation, I finally tried the service out of desperation. Got connected to an IRS business tax specialist in about 37 minutes (the system kept me updated by text while it was working). The agent confirmed I could use the reasonable cause exception for my late filing, reviewed my specific dates, and even told me which supporting documents would strengthen my case. The best part was getting confirmation directly from the IRS about my situation rather than relying on internet advice. The agent explained a nuance about my situation (I had a prior LLC conversion) that affected how I needed to complete certain parts of Form 2553. Probably saved me from having my election rejected and going through the whole process again.

Has anyone actually received an acceptance letter after filing a late S corp election? I submitted mine 3 months ago with what I thought was a solid reasonable cause statement (computer crash lost my records + tax preparer mistake) but haven't heard anything back. Starting to get nervous about 2024 tax planning.

Question for those who've filed late S corp elections - if I file Form 2553 now (August 2024) requesting an effective date of January 1, 2024, do I need to file my 2024 quarterly estimated tax payments based on S corp tax treatment or still as a single-member LLC until the election is approved?

I went through this exact situation last year and can confirm that the late S corp election relief is definitely available, but there are a few important details to get right that I wish someone had told me upfront. First, when you file Form 2553 for the late election, make sure you're requesting the effective date as January 1, 2024 (not your LLC formation date in September 2023). The S corp election can only be effective from the beginning of a tax year, so even though you formed the LLC in September 2023, your earliest possible S corp effective date would be January 1, 2024. Second, since you mentioned you've been paying yourself a reasonable salary and taking distributions, make sure you have all those payroll records organized. The IRS will want to see that you've been consistently operating as an S corp, including proper payroll tax withholdings and quarterly 941 filings. If you haven't been doing formal payroll with withholdings, you might want to get that straightened out before filing the election. The reasonable cause statement doesn't need to be overly complex - I kept mine to about 3-4 sentences explaining that I was unaware of the deadline and that my regular tax advisor was unavailable. The key is showing you had good faith intent to elect S corp status from the beginning of the tax year. One last tip: include copies of your LLC operating agreement and any documentation showing you intended S corp treatment (like board resolutions about salary, etc.) to strengthen your case. Good luck!