The IRS may not waive an invalid S corporation election if the failure is caused by:...

The IRS may not waive an invalid S corporation election if the failure is caused by: A. a failure to obtain required consents. B. a reasonable cause for a late election. C. a shareholder refusing to sign the consent during the IRS-approved extension period. D. an inadvertent failure to qualify as a small business corporation based on extenuating circumstances.

Expert Solution

Answer :A

1)There are many reasons why forms are not filed and not timely filed. Sometimes the mistake occurs at the time the corporation is organized. For example, the shareholders may have contemplated that the corporation would have S status from its inception, but the necessary forms were inadvertently not filed, such as the shareholder consent form. The Code and the IRS (through its administrative
procedures) provide significant liberality in remedying a filing failure.

2)Ordinarily, a timely filed S corporation election will not be invalid because a shareholder failed to file a timely consent to that election if (1) a reasonable cause for failure to file such consent (or consents) is shown, (2) proper consent is filed within an extended period granted by the IRS, and (3) new consents are filed by all persons who were shareholders at any time during the taxable year with respect to which the failure to consent occurred.

ekkarill92 answered 1 year ago

why is the election for s corporation status attractive?

2. The S corporation election, once made, can be terminated. How? Discuss how an S election...

2. The S corporation election, once made, can be terminated. How? Discuss how an S election might terminate. 3. Dana owns a one-third capital and profits interest in the Spendalot Partners partnership. The partnership uses the calendar year. Her partnership interest had a basis to her of $240,000. This year, the partnership distributes the following assets to Dana: (1) cash of $280,000; and (2) stocks held for investment, having a basis of $60,000 to the partnership, and a fair market...

1. Complete the following statements regarding the election of S corporation status. A qualifying election requires...

1. Complete the following statements regarding the election of S corporation status. A qualifying election requires the consent of (the majority/at least 80%/all) of the corporation's shareholders. The election is made on (Form 1120S/Form 1065/Form 2553). For S corporation status to apply in the current tax year, the election must be filed either (on the date of incorporation/in the previous year) or on or before the fifteenth day of the (first/third/fourth/sixth) month of the current year. 2. Complete the following...

List five disadvantages of making an S election. (Select all that apply.) A. An S corporation...

List five disadvantages of making an S election. (Select all that apply.) A. An S corporation is subject to the personal holding company tax or the accumulated earnings tax if they elect to have a year-end that is not a calendar year end. B. Allocation of ordinary income or loss and the separately stated items is based on the stock owned on each day of the tax year. Special allocations of particular items are not permitted, as they are in...

Which corporation is eligible to make the S election? A- Foreign corporation. B- A one-shareholder corporation....

Which corporation is eligible to make the S election? A- Foreign corporation. B- A one-shareholder corporation. C- An insurance company D- A US. bank E- None of the above can select S status.

C Corporation has an S corporation election in effect. During the 2017 calendar tax year, the...

C Corporation has an S corporation election in effect. During the 2017 calendar tax year, the corporation had ordinary taxable income of $200,000, and on January 15, 2017, the corporation paid dividends to shareholders in the amount of $120,000. How much taxable income, in total, must the shareholders of the corporation report on their 2017 tax returns? $120,000 dividend income is taxable income. Should total include $200k ordinary income?

what type of market failure caused creation of medicaid?

Last year Drone Corporation was formed on January 1st. An S election was filed by March...

Last year Drone Corporation was formed on January 1st. An S election was filed by March 15th of the same year. When the S election was filed it was missing a consent from one of the shareholders. The missing consent was filed on August 5th. Which of he following statements is correct? A- The S election is valid for last year, if the shareholder was out of the country until August 1st. B- The S election will be vaild beginning...

Failure analysis aims to identify the causes of failure and failure may arise during the product...

Failure analysis aims to identify the causes of failure and failure may arise during the product life cycle. The stages of the life cycle for an electronic system are design, prototype, fabrication, and operation. a) Discuss the potential failures during the life cycle of an electronic system. b) Predict the role of failure analysis for each of the stages. c) Recommend the action to be taken to verify the failures.

Determine each of the following arguments’ forms to be valid or invalid. You may use the...

Determine each of the following arguments’ forms to be valid or invalid. You may use the Venn Diagram proof method, the rules/fallacies method, or any other method, of your choice. 1. Some athletes are not baseball players and some baseball players are not basketball players. Therefore, some athletes are not basketball players.2. All creationists are fundamentalists because all fundamentalists are religious people and all creationists are religious people. 3. As no conservationists are litterers, no environmentalists are litterers, because all...

Question