What is Form 2553? Definition, requirements, and how it applies to your business formation. Learn everything about irs form 2553 for LLCs and corporations.
# IRS Form 2553
Form 2553 (Election by a Small Business Corporation) is the IRS form used to elect S-Corp tax treatment for an eligible LLC or corporation. Once filed and accepted, the entity's income passes through to shareholders' personal returns, and distributions above reasonable salary are exempt from self-employment tax.
Form 2553 must be filed within 75 days of the start of the tax year for the election to be effective that year, or at any time during the preceding tax year. Late elections are possible with reasonable cause but require additional documentation.
Lovie includes Form 2553 preparation and filing as an add-on to LLC and corporation formations, timed to meet the 75-day window.