Blank IRS 2553 Template

The IRS 2553 form is used by small businesses to elect S corporation status for federal tax purposes. This election allows income, deductions, and credits to pass through to shareholders, potentially reducing overall tax liability. To get started on your S corporation election, fill out the form by clicking the button below.

Article Structure

When starting a business, choosing the right tax structure is crucial for both financial health and compliance. One important step in this process is filing the IRS Form 2553, which allows eligible small businesses to elect S Corporation status. This designation can provide various tax advantages, including the potential to avoid double taxation on corporate income. To qualify, a business must meet specific criteria, such as having a limited number of shareholders and being a domestic corporation. The form requires detailed information about the business, including its name, address, and the date of the election. Timeliness is key; the form must be submitted within a certain timeframe to ensure the election takes effect for the desired tax year. Understanding the ins and outs of Form 2553 is essential for business owners who want to optimize their tax situation while remaining compliant with IRS regulations.

Form Sample

Note: Form 2553 begins on the next page.

Where To File Form 2553 after 6/17/19

If the corporation’s principal business, office,	Use the following address
or agency is located in	or fax number

Connecticut, Delaware, District of Columbia,	Department of the Treasury
Georgia, Illinois, Indiana, Kentucky, Maine,	Internal Revenue Service
Maryland, Massachusetts, Michigan, New	Kansas City, MO 64999
Hampshire, New Jersey, New York, North Carolina,
Ohio, Pennsylvania, Rhode Island, South Carolina,
Tennessee, Vermont, Virginia, West Virginia,	Fax # 855-887-7734
Wisconsin

Alabama, Alaska, Arizona, Arkansas, California,	Department of the Treasury
Colorado, Florida, Hawaii, Idaho, Iowa, Kansas,	Internal Revenue Service
Louisiana, Minnesota, Mississippi, Missouri,	Ogden, UT 84201
Montana, Nebraska, Nevada, New Mexico, North
Dakota, Oklahoma, Oregon, South Dakota, Texas,
Utah, Washington, Wyoming	Fax # 855-214-7520

Form 2553

(Rev. December 2017)

Department of the Treasury Internal Revenue Service

Election by a Small Business Corporation

(Under section 1362 of the Internal Revenue Code)

(Including a late election filed pursuant to Rev. Proc. 2013-30)

▶You can fax this form to the IRS. See separate instructions.

▶Go to www.irs.gov/Form2553 for instructions and the latest information.

OMB No. 1545-0123

Note: This election to be an S corporation can be accepted only if all the tests are met under Who May Elect in the instructions, all shareholders have signed the consent statement, an officer has signed below, and the exact name and address of the corporation (entity) and other required form information have been provided.

Part I		Election Information
		Name (see instructions)	A Employer identification number
Type
Type		Number, street, and room or suite no. If a P.O. box, see instructions.	B Date incorporated
or			B Date incorporated
or
Print
Print		City or town, state or province, country, and ZIP or foreign postal code	C State of incorporation
			C State of incorporation

D	Check	the applicable box(es) if the corporation (entity), after applying for the EIN shown in A above, changed its		name or	address

EElection is to be effective for tax year beginning (month, day, year) (see instructions) . . . . . . ▶

Caution: A corporation (entity) making the election for its first tax year in existence will usually enter the beginning date of a short tax year that begins on a date other than January 1.

FSelected tax year:

(1) Calendar year

(2) Fiscal year ending (month and day) ▶

(3) 52-53-week year ending with reference to the month of December

(4) 52-53-week year ending with reference to the month of ▶

If box (2) or (4) is checked, complete Part II.

GIf more than 100 shareholders are listed for item J (see page 2), check this box if treating members of a family as one shareholder results in no more than 100 shareholders (see test 2 under Who May Elect in the instructions) ▶

HName and title of officer or legal representative whom the IRS may call for more information

Telephone number of officer or legal representative

IIf this S corporation election is being filed late, I declare I had reasonable cause for not filing Form 2553 timely. If this late election is being made by an entity eligible to elect to be treated as a corporation, I declare I also had reasonable cause for not filing an entity classification election timely and the representations listed in Part IV are true. See below for my explanation of the reasons the election or elections were not made on time and a description of my diligent actions to correct the mistake upon its discovery. See instructions.

	Under penalties of perjury, I declare that I have examined this election, including accompanying documents, and, to the best of my
Sign knowledge and belief, the election contains all the relevant facts relating to the election, and such facts are true, correct, and complete.
Here	▲Signature of officer
		Title	Date
For Paperwork Reduction Act Notice, see separate instructions.		Cat. No. 18629R	Form 2553 (Rev. 12-2017)

Form 2553 (Rev. 12-2017)	Page 2
Name	Employer identification number

Part I Election Information (continued) Note: If you need more rows, use additional copies of page 2.

Name and address of each

shareholder or former shareholder required to consent to the election.

(see instructions)

Shareholder’s Consent Statement

Under penalties of perjury, I declare that I consent to the election of the above-named corporation (entity) to be an S corporation under section 1362(a) and that I have examined this consent statement, including accompanying documents, and, to the best of my knowledge and belief, the election contains all the relevant facts relating to the election, and such facts are true, correct, and complete. I understand my consent is binding and may not be withdrawn after the corporation (entity) has made a valid election. If seeking relief for a late filed election, I also declare under penalties of perjury that I have reported my income on all affected returns consistent with the S corporation election for the year for which the election should have been filed (see beginning date entered on line E) and for all subsequent years.

Signature

Date

Stock owned or

percentage of ownership

(see instructions)

Number of
shares or
percentage	Date(s)
of ownership	acquired

M
Social security
number or	N
employer	Shareholder’s
identification	tax year ends
number (see	(month and
instructions)	day)

Form 2553 (Rev. 12-2017)

Form 2553 (Rev. 12-2017)		Page 3
Name		Employer identification number

Part II	Selection of Fiscal Tax Year (see instructions)
Note: All corporations using this part must complete item O and item P, Q, or R.
O Check the applicable box to indicate whether the corporation is:
1.	A new corporation adopting the tax year entered in item F, Part I.
2.	An existing corporation retaining the tax year entered in item F, Part I.
3.	An existing corporation changing to the tax year entered in item F, Part I.

PComplete item P if the corporation is using the automatic approval provisions of Rev. Proc. 2006-46, 2006-45 I.R.B. 859, to request (1) a natural business year (as defined in section 5.07 of Rev. Proc. 2006-46) or (2) a year that satisfies the ownership tax year test (as defined in section 5.08 of Rev. Proc. 2006-46). Check the applicable box below to indicate the representation statement the corporation is making.

1. Natural Business Year ▶

I represent that the corporation is adopting, retaining, or changing to a tax year that qualifies

as its natural business year (as defined in section 5.07 of Rev. Proc. 2006-46) and has attached a statement showing separately for each month the gross receipts for the most recent 47 months. See instructions. I also represent that the corporation is not precluded by section 4.02 of Rev. Proc. 2006-46 from obtaining automatic approval of such adoption, retention, or change in tax year.

2. Ownership Tax Year ▶

I represent that shareholders (as described in section 5.08 of Rev. Proc. 2006-46) holding more

than half of the shares of the stock (as of the first day of the tax year to which the request relates) of the corporation have the same tax year or are concurrently changing to the tax year that the corporation adopts, retains, or changes to per item F, Part I, and that such tax year satisfies the requirement of section 4.01(3) of Rev. Proc. 2006-46. I also represent that the corporation is not precluded by section 4.02 of Rev. Proc. 2006-46 from obtaining automatic approval of such adoption, retention, or change in tax year.

Note: If you do not use item P and the corporation wants a fiscal tax year, complete either item Q or R below. Item Q is used to request a fiscal tax year based on a business purpose and to make a back-up section 444 election. Item R is used to make a regular section 444 election.

QBusiness Purpose—To request a fiscal tax year based on a business purpose, check box Q1. See instructions for details including payment of a user fee. You may also check box Q2 and/or box Q3.

1. Check here ▶ if the fiscal year entered in item F, Part I, is requested under the prior approval provisions of Rev. Proc. 2002-39, 2002-22 I.R.B. 1046. Attach to Form 2553 a statement describing the relevant facts and circumstances and, if applicable, the gross receipts from sales and services necessary to establish a business purpose. See the instructions for details regarding the gross receipts from sales and services. If the IRS proposes to disapprove the requested fiscal year, do you want a conference with the IRS National Office?

Yes

2.Check here ▶ to show that the corporation intends to make a back-up section 444 election in the event the corporation’s business purpose request is not approved by the IRS. See instructions for more information.

3.Check here ▶ to show that the corporation agrees to adopt or change to a tax year ending December 31 if necessary for the IRS to accept this election for S corporation status in the event (1) the corporation’s business purpose request is not approved and the corporation makes a back-up section 444 election, but is ultimately not qualified to make a section 444 election, or (2) the corporation’s business purpose request is not approved and the corporation did not make a back-up section 444 election.

RSection 444 Election—To make a section 444 election, check box R1. You may also check box R2.

1.Check here ▶ to show that the corporation will make, if qualified, a section 444 election to have the fiscal tax year shown in item F, Part I. To make the election, you must complete Form 8716, Election To Have a Tax Year Other Than a Required Tax Year, and either attach it to Form 2553 or file it separately.

2.Check here ▶ to show that the corporation agrees to adopt or change to a tax year ending December 31 if necessary for the IRS to accept this election for S corporation status in the event the corporation is ultimately not qualified to make a section 444 election.

Form 2553 (Rev. 12-2017)

Form 2553 (Rev. 12-2017)	Page 4
Name	Employer identification number

Part III Qualified Subchapter S Trust (QSST) Election Under Section 1361(d)(2)* Note: If you are making more than

one QSST election, use additional copies of page 4.

Income beneficiary’s name and address

Social security number

Trust’s name and address

Employer identification number

Date on which stock of the corporation was transferred to the trust (month, day, year) . . . . . . . . ▶

In order for the trust named above to be a QSST and thus a qualifying shareholder of the S corporation for which this Form 2553 is filed, I hereby make the election under section 1361(d)(2). Under penalties of perjury, I certify that the trust meets the definitional requirements of section 1361(d)(3) and that all other information provided in Part III is true, correct, and complete.

Signature of income beneficiary or signature and title of legal representative or other qualified person making the election

Date

*Use Part III to make the QSST election only if stock of the corporation has been transferred to the trust on or before the date on which the corporation makes its election to be an S corporation. The QSST election must be made and filed separately if stock of the corporation is transferred to the trust after the date on which the corporation makes the S election.

Part IV Late Corporate Classification Election Representations (see instructions)

If a late entity classification election was intended to be effective on the same date that the S corporation election was intended to be effective, relief for a late S corporation election must also include the following representations.

1The requesting entity is an eligible entity as defined in Regulations section 301.7701-3(a);

2The requesting entity intended to be classified as a corporation as of the effective date of the S corporation status;

3The requesting entity fails to qualify as a corporation solely because Form 8832, Entity Classification Election, was not timely filed under Regulations section 301.7701-3(c)(1)(i), or Form 8832 was not deemed to have been filed under Regulations section 301.7701-3(c)(1)(v)(C);

4The requesting entity fails to qualify as an S corporation on the effective date of the S corporation status solely because the S corporation election was not timely filed pursuant to section 1362(b); and

5a The requesting entity timely filed all required federal tax returns and information returns consistent with its requested classification as an S corporation for all of the years the entity intended to be an S corporation and no inconsistent tax or information returns have been filed by or with respect to the entity during any of the tax years, or

bThe requesting entity has not filed a federal tax or information return for the first year in which the election was intended to be effective because the due date has not passed for that year’s federal tax or information return.

Form 2553 (Rev. 12-2017)

⇩ PDF

Document Specifications

Fact Name	Description
Purpose	The IRS Form 2553 is used by eligible small businesses to elect S corporation status for federal tax purposes.
Eligibility	To qualify, a corporation must meet specific criteria, including having no more than 100 shareholders and only one class of stock.
Filing Deadline	The form must be filed within 75 days of the beginning of the tax year for which the election is to take effect.
State Forms	Some states require their own forms for S corporation election. For example, California uses Form 100S.
Governing Law (California)	California Revenue and Taxation Code Section 23802 governs S corporation elections in California.
Shareholder Consent	All shareholders must consent to the S corporation election by signing the form.
Tax Benefits	Electing S corporation status can provide tax benefits, such as avoiding double taxation on corporate income.

Steps to Filling Out IRS 2553

Once you have your IRS Form 2553 ready, the next step involves carefully filling it out to ensure that your election is processed smoothly. This form is essential for small businesses that wish to be taxed as an S corporation. Completing it accurately is crucial, as errors can lead to delays or complications with your tax status.

Begin by downloading the IRS Form 2553 from the IRS website or obtaining a physical copy.
Fill in the name of your corporation at the top of the form. Ensure that it matches the name registered with the state.
Provide the corporation’s Employer Identification Number (EIN) in the designated section.
Enter the date of incorporation. This information can usually be found on your state’s incorporation documents.
Indicate the state in which your corporation was formed.
Specify the tax year your corporation operates under. Most businesses use a calendar year, but some may have a fiscal year.
In the section for shareholders, list the names, addresses, and Social Security numbers of all shareholders. Ensure that each shareholder meets the eligibility requirements.
Next, provide the percentage of stock ownership for each shareholder. This is important for determining how income will be allocated.
Check the box that indicates whether you are a qualified subchapter S subsidiary, if applicable.
Sign and date the form. An authorized officer of the corporation must sign it.
Finally, submit the completed form to the IRS. Be sure to keep a copy for your records.

More About IRS 2553

What is IRS Form 2553?

IRS Form 2553 is used by small business corporations to elect S corporation status. By filing this form, a corporation can choose to be taxed under Subchapter S of the Internal Revenue Code, allowing income, losses, and deductions to pass through to shareholders, avoiding double taxation at the corporate level.

Who is eligible to file Form 2553?

To qualify for S corporation status, a business must meet certain criteria. It must be a domestic corporation, have no more than 100 shareholders, and only have allowable shareholders, which include individuals, certain trusts, and estates. Additionally, the corporation can only have one class of stock.

When should Form 2553 be filed?

Form 2553 should be filed within two months and 15 days after the beginning of the tax year the election is to take effect. For example, if a corporation wants to be treated as an S corporation for the tax year starting January 1, it must file by March 15 of that year. Late elections may be accepted under certain circumstances.

What information is required on Form 2553?

The form requires basic information about the corporation, including its name, address, and Employer Identification Number (EIN). Additionally, it requires the names and addresses of all shareholders, as well as their consent to the S corporation election. Accurate completion is crucial to ensure the election is valid.

What happens after filing Form 2553?

Once Form 2553 is submitted, the IRS will review the application. If approved, the corporation will receive confirmation of its S corporation status. It is important for the corporation to maintain compliance with S corporation requirements to retain this status in future tax years.

What are the consequences of not filing Form 2553?

If a corporation does not file Form 2553 and does not meet the criteria for S corporation status, it will be taxed as a C corporation. This means the corporation will face double taxation on its income—once at the corporate level and again at the shareholder level when dividends are distributed. This can result in a higher overall tax burden for both the corporation and its shareholders.

Common mistakes

Not checking the eligibility requirements before filing. It's crucial to ensure that your business qualifies as an S Corporation.
Failing to sign and date the form. An unsigned form will be considered incomplete and may delay the process.
Incorrectly reporting the number of shareholders. Make sure to count all shareholders accurately, as this can affect your eligibility.
Missing the filing deadline. The form must be submitted on time to be effective for the desired tax year.
Providing inaccurate or incomplete information. Double-check all entries for accuracy to avoid complications.
Not using the correct tax year. Ensure that the tax year you select aligns with your business operations.
Neglecting to include all necessary attachments. Any required documents should be submitted along with the form.
Using an outdated version of the form. Always download the latest version from the IRS website to ensure compliance.
Forgetting to notify the IRS of any changes. If your business structure or ownership changes, update the IRS promptly.
Overlooking state requirements. Some states have additional forms or regulations related to S Corporations.

Documents used along the form

The IRS Form 2553 is crucial for small businesses wishing to elect S Corporation status. However, several other forms and documents often accompany it to ensure compliance with federal and state regulations. Below is a list of these related documents, each serving a specific purpose in the process of establishing and maintaining an S Corporation.

IRS Form 1120S: This is the tax return form specifically for S Corporations. It reports income, deductions, and credits, and it must be filed annually to maintain S Corporation status.
IRS Form 941: Employers use this form to report income taxes, Social Security tax, and Medicare tax withheld from employee paychecks. It is filed quarterly and is essential for payroll compliance.
IRS Form SS-4: This form is used to apply for an Employer Identification Number (EIN), which is necessary for tax administration and is often required to open a business bank account.
State S Corporation Election Form: Many states have their own forms for electing S Corporation status. These forms must be filed in addition to the federal IRS Form 2553 to ensure state compliance.
Operating Agreement: Although not always required, this document outlines the management structure and operating procedures of the S Corporation. It is essential for clarifying roles and responsibilities among owners.
Bylaws: Bylaws govern how the S Corporation will operate. They include rules about meetings, voting, and the responsibilities of officers and directors.
Form 2553-A: This is a statement of consent by shareholders. It is sometimes required to confirm that all shareholders agree to the S Corporation election.
Form 1065: If the business has partners, this form is used to report income, deductions, gains, and losses from the partnership. It is important for tax purposes, even if the business elects S Corporation status.
Schedule K-1 (Form 1120S): This document reports each shareholder's share of income, deductions, and credits from the S Corporation. It is essential for shareholders to accurately report their income on personal tax returns.
State Business License: Depending on the state and type of business, a license may be required to operate legally. This document ensures compliance with local regulations.

Understanding these forms and documents is vital for anyone looking to establish or maintain an S Corporation. Proper completion and timely submission of these materials can help avoid legal complications and ensure the business operates smoothly within the regulatory framework.

Similar forms

The IRS Form 8832, also known as the Entity Classification Election, allows businesses to choose how they want to be classified for federal tax purposes. Like Form 2553, which is used by small businesses to elect S Corporation status, Form 8832 provides a mechanism for businesses to opt into a specific tax treatment. Both forms require timely submission to ensure the desired tax classification takes effect in the appropriate tax year. Understanding the nuances of these forms can help business owners make informed decisions about their tax obligations.

Form 1065, the U.S. Return of Partnership Income, is another document that shares similarities with Form 2553. While Form 2553 is used to elect S Corporation status, Form 1065 is filed by partnerships to report income, deductions, gains, and losses. Both forms are crucial for determining the tax responsibilities of the business entity. They require detailed financial information and are essential for compliance with IRS regulations, ensuring that all partners or shareholders are properly informed about their tax liabilities.

Form 1120, the U.S. Corporation Income Tax Return, is also comparable to Form 2553. This form is used by C Corporations to report their income, gains, losses, and deductions. While Form 2553 allows a corporation to elect S status, Form 1120 is the standard tax return for corporations not electing S status. Both forms require comprehensive financial reporting and have specific filing deadlines, making them integral to understanding corporate tax obligations.

Form 941, the Employer's Quarterly Federal Tax Return, is another important document that relates to the IRS 2553. While Form 2553 is focused on the election of S Corporation status, Form 941 is used to report income taxes, Social Security tax, and Medicare tax withheld from employee wages. Both forms are essential for compliance with federal tax regulations, and timely filing is critical to avoid penalties. Business owners must understand how these forms interact, especially when determining tax withholdings for shareholders who are also employees.

Form 1099, specifically the 1099-MISC or 1099-NEC, is relevant in the context of Form 2553 as well. These forms are used to report various types of income other than wages, salaries, and tips. While Form 2553 is concerned with the election of S Corporation status, the 1099 forms help businesses report payments made to contractors or other non-employees. Both forms play a role in ensuring accurate reporting of income and compliance with IRS regulations, emphasizing the importance of proper documentation in business operations.

Finally, Form 4562, the Depreciation and Amortization form, has similarities with Form 2553 in terms of tax implications for businesses. Form 4562 is used to claim deductions for depreciation and amortization, which can significantly affect a business's taxable income. Like Form 2553, which allows for S Corporation election to potentially reduce tax liabilities, Form 4562 enables businesses to manage their expenses effectively. Both forms require careful attention to detail and understanding of tax laws to maximize potential benefits.

Dos and Don'ts

When filling out the IRS 2553 form, it is important to follow certain guidelines to ensure accuracy and compliance. Here are some dos and don'ts to consider:

Do read the instructions carefully before starting the form.
Do provide accurate information about your business entity.
Do file the form on time to avoid penalties.
Do ensure that all shareholders sign the form where required.

Don't leave any sections blank unless instructed.
Don't use incorrect or outdated forms.
Don't forget to check for any additional state requirements.
Don't submit the form without a thorough review for errors.

Misconceptions

The IRS Form 2553 is an important document for small business owners who wish to elect S Corporation status. However, several misconceptions surround this form that can lead to confusion. Here are five common misunderstandings:

Only large corporations need to file Form 2553. Many people believe that only large businesses can benefit from S Corporation status. In reality, small businesses, including sole proprietorships and partnerships, can also elect this status to enjoy potential tax benefits.
Form 2553 can be filed at any time. Some individuals think they can submit Form 2553 whenever they choose. However, there are specific deadlines. Generally, the form must be filed within 75 days of the beginning of the tax year when the S Corporation status is desired.
All businesses can qualify for S Corporation status. Not every business can elect S Corporation status. There are eligibility requirements, such as the number of shareholders and the types of stock issued. Understanding these criteria is essential before filing.
Filing Form 2553 guarantees tax savings. While many believe that filing this form will automatically lead to tax savings, that is not always the case. The benefits depend on various factors, including income levels and business expenses.
Once filed, the S Corporation status cannot be changed. Some people think that once they elect S Corporation status, they are locked in forever. In truth, businesses can revoke their S Corporation status or switch to another tax classification if their circumstances change.

Understanding these misconceptions can help business owners make informed decisions regarding their tax status and ensure compliance with IRS regulations.

Key takeaways

Filling out the IRS Form 2553 is an important step for small business owners who want to elect S Corporation status. Here are some key takeaways to keep in mind:

Eligibility Requirements: Not all businesses can elect S Corporation status. Ensure your business meets the eligibility criteria, including being a domestic corporation and having no more than 100 shareholders.
Filing Deadline: The form must be filed within 75 days of the beginning of the tax year for which the election is to take effect. Missing this deadline could result in your business being taxed as a C Corporation.
Shareholder Consent: All shareholders must consent to the S Corporation election. This consent is typically indicated by their signatures on the form.
Tax Year Considerations: S Corporations generally must adopt a calendar year as their tax year. If you wish to use a different tax year, additional steps may be necessary.
Form Completion: Take care when filling out the form. Accurate and complete information is crucial to avoid delays or issues with your election.
IRS Processing Time: After submission, the IRS may take several weeks to process the Form 2553. Be patient, and keep an eye out for any correspondence from the IRS.
Revocation of Election: If you decide to revoke your S Corporation status, you can do so by filing a statement with the IRS. Understand the implications of revocation before proceeding.
Consult a Professional: If you have questions or concerns about the process, consider consulting a tax professional. Their expertise can help ensure that you make informed decisions.

By keeping these takeaways in mind, business owners can navigate the process of filing Form 2553 more effectively, paving the way for potential tax benefits associated with S Corporation status.