Breaking Up With Your S-Corp Part 2 Tax In Action: Practical Strategies For Tax Pros podcast

Tax in Action: Practical Strategies for Tax Pros »

3d ago 58:22

Content provided by Earmark Media, Jeremy Wells, EA, and CPA. All podcast content including episodes, graphics, and podcast descriptions are uploaded and provided directly by Earmark Media, Jeremy Wells, EA, and CPA or their podcast platform partner. If you believe someone is using your copyrighted work without your permission, you can follow the process outlined here https://podcastplayer.com/legal.

Jeremy wraps up his two-part series on S corporation terminations by diving into what happens after an election ends, whether intentional or inadvertent. He explains the IRS's relief procedures for common mistakes like violating the one-class-of-stock rule, the crucial five-year waiting period before re-electing, and why a terminated S corp doesn't just revert back to an LLC but becomes a C corporation instead. The discussion includes real tax court cases and the specific steps needed to clean up termination issues before the IRS discovers them.

(00:00) - Introduction and Recap of Part One

(01:40) - Three Ways to Terminate an S Election

(03:30) - Administrative Dissolutions at the State Level

(08:00) - What Happens After S Election Termination

(13:10) - Inadvertent Terminations Explained

(17:00) - The One Class of Stock Rule

(21:30) - Maggard v. Commissioner Tax Court Case

(26:20) - Profit Interests and Phantom Equity Problems

(29:40) - IRS Relief for Inadvertent Terminations

(34:30) - Revenue Procedure 2022-19

(39:20) - Missing S Election Acceptance Letters

(42:00) - Filing the Wrong Return Type

(44:10) - Six Areas of Relief Without a PLR

(47:10) - Short Year Returns and Pro Rata Allocation

(51:30) - The Five-Year Rule Explained

(54:20) - Reverting from C Corp Back to LLC Status

(56:50) - Final Thoughts and Episode Wrap-Up

Connect with Jeremy
https://www.linkedin.com/in/jwellstax
https://www.steadfastbookkeeping.com

Subscribe on YouTube
https://www.youtube.com/@TaxinAction

Earn CPE for Listening to This Podcast
https://www.earmark.app/

This podcast is a production of Earmark Media

15 episodes