Duluth CPA Advises Gwinnett Taxpayers on Selecting a Tax Year
Generally tax law requires all S Corporation owners to have a calendar tax year. However if you can qualify for a tax year other than a calendar year if you qualify.
Under IRS Code section 444, S Corporations can file under a new tax year instead of the required year. To correctly perform this, the deferral period in which the 444 is enacted must be less than three months. The form required for a 444 is Form 8716: Election To Have a Tax Year Other Than a Required Tax Year.
If the corporation is part of a tiered structure through partnerships and other corporations then the corporation can not file under section 444. If an S Corporation wants to take the section 444 into effect they must pay all the required dues. Section 444 elections end if an S Corporation:
• Changes its period of accounting to a calendar year or some other permitted year. • Is penalized for purposefully not paying the requirements of section 7519 or • Terminates the S corporation election, unless it becomes a personal service corporation
John Dillard, CPA of His CPA, PC, 1940 Woods River Lane, Duluth, GA 30097 Phone 770-814-9304 www.HisCPA.com A Christian CPA Firm