S-Corp has Income after Filing Final Return

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catchinup
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S-Corp has Income after Filing Final Return

Post by catchinup »

For tax year 2022, I filed a final return for my S-Corp. Turns out in 2023 I will receive a 1099 from Treasury direct for several hundred dollars of interest income which got transferred to my personal TD account. I did NOT close the EIN yet, but have no other receipts for 2023. Does anyone have any idea how this should be handled as it seems I need to file a second "Final" return for tax year 2023.
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MP123
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Re: S-Corp has Income after Filing Final Return

Post by MP123 »

I think you can file a 2023 1120S also marked final, without having to amend 2022 to remove the final. At least it's worth a try.
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catchinup
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Re: S-Corp has Income after Filing Final Return

Post by catchinup »

MP123 wrote: Sun Aug 06, 2023 7:36 pm I think you can file a 2023 1120S also marked final, without having to amend 2022 to remove the final. At least it's worth a try.
I think this is what I will do. I may call the IRS to see if I get can any information.
hachiko
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Re: S-Corp has Income after Filing Final Return

Post by hachiko »

Did you file for an extension for 2022? If so, you should be able to just file a superseding return now - the exact same return without the "final" box checked - no need to amend. I'm not sure if you can file a superseding return now if you didn't have an extension.

I'm not sure what to do otherwise. Calling the IRS may not be a bad idea if you have the time. Did you already file form 966?
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catchinup
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Re: S-Corp has Income after Filing Final Return

Post by catchinup »

hachiko wrote: Wed Aug 09, 2023 6:59 am Did you file for an extension for 2022? If so, you should be able to just file a superseding return now - the exact same return without the "final" box checked - no need to amend. I'm not sure if you can file a superseding return now if you didn't have an extension.

I'm not sure what to do otherwise. Calling the IRS may not be a bad idea if you have the time. Did you already file form 966?
Hi I just noticed your response several months later. I did not file for an extension. The 1120S was filed in March, 2023 and marked final. No, I did not file 966 yet. I'll do that after I file the real final return for 2023. I guess I need to call the IRS which I didn't do yet. I've been using an accountant. He didn't suggest calling the IRS but I should I think. Maybe I can still amend the 2022 return to uncheck the final box.
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catchinup
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Form 966 Advice for S-Corp Shutdown Screw up

Post by catchinup »

[Thread merged into here --admin LadyGeek]

For tax year 2022, I filed a 1120-S and marked the return as Final. I did not file a 966 at that time because I mistakenly didn't read the form to know I had 30 days since the resolution to shut down to file the 966 form. To top things, I had some I-bonds in the S-Corp that were in the process of being transferred to my personal T-direct account. I technically should have waited until this final asset was distributed to file the final return, but I was not aware this would trigger a taxable event. So the S-Corp received a 1099 for around $800 of interest for tax year 2023. I asked my accountant did I need to file another return for 2023, and if so what to do about the previous return being marked final. He suggested to leave the corp as is and report the interest to myself as a nominee from corp. He said IRS may issue a notice about not reporting on the corp, but I can respond to notice stating it was reported on personal. At the time we had that interaction, I hadn't realized I was probably late in filing the 966 form. I'm reading now if the 966 is not filed within 30 days, I could be fined. I'm completely confused about what to do at this point and I have been calling the IRS business number and have been unable to connect to someone who can help. Maybe I should just file a second final return for 2023 to report the interest, and file the 966 with it?

I frankly don't understand how anyone would be able to file the 966 within 30 days of resolving to shut down anyway. The form asks you for the date of the final return. A corporation filing a final return would have to had resolved to shut down the S-corp well in advance of being able to file a final return as it requires doing many things -- distributing assets, shutting down bank accounts, etc.
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MP123
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Re: Form 966 Advice for S-Corp Shutdown Screw up

Post by MP123 »

When did you actually dissolve the corporation with the state? 966 just reports the resolution, not the actual termination.

If it's still active you could just file another final 1120S reporting the interest and then shut the thing down properly.

I don't know of any particular fine or penalty for an unfiled 966, but there is one for 1120S if the corporation is still active.
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Re: S-Corp has Income after Filing Final Return

Post by LadyGeek »

catchinup - In order to provide appropriate advice, it's best to keep all the information in one spot. I merged your update back into the original thread. If you have any questions, ask them here.

The combined thread is in the Personal Finance (Not Investing) forum (taxes).

(Thanks to the member who reported the post and provided a link to this thread.)
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catchinup
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Re: Form 966 Advice for S-Corp Shutdown Screw up

Post by catchinup »

MP123 wrote: Mon Feb 12, 2024 7:00 am When did you actually dissolve the corporation with the state? 966 just reports the resolution, not the actual termination.

If it's still active you could just file another final 1120S reporting the interest and then shut the thing down properly.

I don't know of any particular fine or penalty for an unfiled 966, but there is one for 1120S if the corporation is still active.
I dissolved with the state in November 2023.. There was no 2023 activity other than the interest income.

When I Google search about the 966 form it says there's a penalty if it's not filed within 30 days of the decision to dissolve.
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