Discussion:1st Year S-Corp for Feds, NYS is invalid S, so a C-Corp

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Discussion Forum Index --> Tax Questions --> 1st Year S-Corp for Feds, NYS is invalid S, so a C-Corp


Fsteincpa (talk|edits) said:

12 April 2014
When the 2553 is filed late, there is retroactive relief for the decision to be an S-Corp.

Does NYS allow this as well. A client has a valid S-Corp election from the Feds but never sent that along with the CT-6 as required by NYS. They have been extended for both as if they were an S-Corp. Client received a notice indicating that they have an invalid extension request as they are not an S-Corp.

Is there any relief for this? I've dealt with this from a multi-year standpoint and wrote letters after the fact and got it corrected, but this is a brand new corp and it's probably just as easy to do a federal S-Corp and a NY C- Corp and then adjust.

I'd prefer not to. Anyone deal with this before?

This is the very first filing and there is a $10,000 loss due to depreciation.

Would you file it as an S-Corp and then simply paper file the state? Or should I do it the "correct" way and keep it a C- Corp for NYS and file it that way?

Ckenefick (talk|edits) said:

12 April 2014
http://www.tax.ny.gov/pdf/memos/multitax/m98_4c_2i.pdf

This is old, but I know I've seen some more recent NY stuff on it.

Fsteincpa (talk|edits) said:

12 April 2014
Where you pull this stuff from brother?

That solves my problem. I have used the arguments within to get granted relief for corporations that have had this issue, but these were a few years into the S-Corp and with this being the initial filing I figured I would ask and see how to do things properly.

I will hang my hat on this and go S-Corp and then seek relief.

Thanks again Chris.

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