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I form a single member LLC in March. In July, I decide I
want it to be taxed as an S corporation. Obviously, I could
form another LLC, take up operations under the new LLC and
file an election.
However, I need to use the existing entity. If I file the S
election July 1, can I make it effective July 1 under the
theory I am electing to be taxed as an association, and
therefore am starting a new tax year, anyway? Or am I stuck
with it being effective Jan. 1, 2006 as it is more than 75
days since the start of the tax year for the SMLLC?
If Jan. 1, can I avoid the issue by forming a subsidiary
SMLLC owned by the existing LLC and having the new LLC file
a Form 2553?
want it to be taxed as an S corporation. Obviously, I could
form another LLC, take up operations under the new LLC and
file an election.
However, I need to use the existing entity. If I file the S
election July 1, can I make it effective July 1 under the
theory I am electing to be taxed as an association, and
therefore am starting a new tax year, anyway? Or am I stuck
with it being effective Jan. 1, 2006 as it is more than 75
days since the start of the tax year for the SMLLC?
If Jan. 1, can I avoid the issue by forming a subsidiary
SMLLC owned by the existing LLC and having the new LLC file
a Form 2553?