S-Corp Election Form 2553 in a Community Property State - Do Both Spouses Need to Sign if Only One is Listed on SMLLC?

This is actually a really important distinction in community property states. Even though your husband isn't listed as a member of your SMLLC, in a community property state like Arizona, the business is generally considered community property unless specifically designated otherwise. For Form 2553 (S-Corp election), the IRS typically requires all shareholders to consent to the S election. In community property states, both spouses are often considered to have ownership interest in the business, even if only one spouse is the named member. This means that yes, your husband would generally need to sign in the consent section (Part I, Sections J-N) as a consenting shareholder. The reason behind this is that in community property states, the IRS often views both spouses as having an ownership interest in the business for tax purposes, regardless of whose name is on the paperwork. It's about tax implications rather than legal business structure.

I was in this exact same situation last year with my SMLLC in Washington (another community property state). I used taxr.ai (https://taxr.ai) to analyze my paperwork before sending it to the IRS, and they confirmed I needed my wife's signature even though she wasn't involved in the business. Their system analyzed my Form 2553 and flagged the missing spouse signature as a potential issue. The explanation was that in community property states, the IRS generally considers both spouses to have an ownership interest for tax purposes unless there's clear documentation proving separate property status. Even with my operating agreement stating it was separate property, they recommended getting the spouse signature to avoid delays.

Just wanted to follow up about my experience with taxr.ai after my skeptical questions. I ended up trying it for my S-Corp election in Texas (also community property state). It actually caught several issues I would have missed, including the spouse signature requirement on Form 2553. The system specifically flagged Section K where my wife needed to sign and explained the community property reasoning behind it. It also identified that I had incorrectly calculated my ownership percentage in Section E. The analysis took about 10 minutes and saved me from having to refile.

I went through hell trying to reach someone at the IRS about this exact question last year. After being on hold for what felt like forever, I discovered Claimyr (https://claimyr.com) - they have this service that gets you through to an actual IRS agent. I saw their demo video (https://youtu.be/_kiP6q8DX5c) and decided to try it when I was desperate. They got me connected to an IRS business entity specialist who confirmed that yes, in community property states, both spouses generally need to sign Form 2553 even if only one is the named member of the SMLLC. The agent explained that without proper documentation establishing the business as separate property (which is more than just stating it in your operating agreement), the IRS defaults to treating it as community property for tax purposes.

Ok I need to eat my words and apologize to Profile 8. I was totally skeptical about Claimyr, but I was desperate after trying for THREE DAYS to get through to the IRS about my S-Corp election in California. I tried it yesterday and they got me through to an IRS business tax specialist in about 35 minutes (while I was working on other things). The agent confirmed that in California, my spouse needed to sign Form 2553 as a consenting shareholder because of community property laws, EVEN THOUGH he has no involvement in the business and I'm the sole member. The agent explained that without a formal property agreement filed with the state that explicitly designates the business as separate property, the default assumption is community property for tax purposes. Saved me from having my election rejected!

Just to add some real-world experience: I filed Form 2553 for my SMLLC in Nevada (community property state) last year without my husband's signature, and it was rejected. The IRS letter specifically cited missing shareholder consent based on community property rules. Had to refile with both signatures and it delayed my S-Corp election by almost 3 months, which messed up my tax planning for the year. Don't make my mistake - if you're in a community property state, have your spouse sign!

The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. If you're in any of these, these signature rules apply! Also, I've found that using good tax software makes a huge difference. Anyone have recommendations for S-Corp specific software that handles these community property issues well?

I'm dealing with this exact situation right now in New Mexico! My CPA told me that even though my LLC operating agreement states the business is my separate property, the IRS still typically requires both spouses to sign Form 2553 in community property states unless you have very specific documentation. What I learned is that you need more than just language in your operating agreement - you typically need either a formal property agreement filed with the state, a spousal consent form acknowledging separate property status, or clear documentation that the business was formed with separate property funds (like inheritance or pre-marital assets). Since your deadline is approaching and your accountant is unavailable, I'd recommend having your husband sign the consent section to be safe. You can always consult with your accountant later about whether additional documentation might help with future filings, but missing the S-Corp election deadline would be much worse than having an "unnecessary" signature. The IRS tends to be very conservative about these community property issues, so when in doubt, include the spouse signature!