S Corporation Tax Tips - How to Begin Preparing Form 1120S

If your business is an S Corporation, you must fileForm 2553 with the IRS, Election by a Small Business
Form 1120S, U.S. Income Tax Return for an SCorporation. Assuming you filed that form correctly, the
Corporation. The purpose of this article is to help youIRS would have sent you a letter entitled "Notice Of
get started preparing this return. Form 1120S is onlyAcceptance As An S-Corporation." In that letter, the
four pages, but don't let it's length fool you. If you areIRS would have stated the effective date of your
going to do this return yourself, you're going to needstatus as an S Corporation. That is the date you want
some help.to put in Item A.
The Easy Part. You can start by putting the businessHere's something important to note: The S Corporation
name and address on the appropriate lines at the topeffective date may not be the same as the date of
of Page 1. Believe me, after that, things do get a bitincorporation. Here's why: you might have incorporated
more difficult.your business and initially operated as a regular C
The Rest of the Top of Page 1. Now notice that thereCorporation for any number of years, and then made
are several information fields to the right and left of thethe S Corporation election in a year other than the
Name/Address section. These fields are labeled withyear of incorporation.
letters from A to I. Each of these fields is important;But if you incorporated and chose S Corporation
this article will focus on Items A and B.status in the same year, then it is likely that your date
Item A: S election effective date. This is the date thatof incorporation and date of S Corporation election are
your corporation first became an S Corporation. Afterthe same. In either case, be sure to check your
you formed this corporation, you should have filedrecords to determine the proper date for Item A.