SMLLC to be taxed as an S Corporation

Forum|Forum|1 year ago
September 16, 2024
2 replies
15 views

I have a client who is a SMLLC and has completed Form 2553, to be taxed as an S Corporation; from what i am reading it looks like it is pretty simple; however, I want to ensure that the entries to move the Balance Sheet items over to the S Corporation are done correctly. Do you have any insight into this that you would be so kind to share with me? I am completing a 351 Transfer Statement to include with the tax returns. From what I have read, I will basically start with a zero Beginning Balance Sheet and reflect the transfer Amount as an M-2 Other Additions for the Balances transferred from the SMLLC books. Does this make sense to you?

Thank you so much!

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Best answer by IRonMaN

Thank you so much!

The First Year S Corp Return and the idea of Beginning Balances being reflected is what did me in. LOL Thank you again! 🙂

You betcha!

qbteachmt

Level 15

Effective when? Which tax year are you working on now?

Don't yell at us; we're volunteers

T

TCl123Author

Level 3

Effective 1.1.2023 - 2023 Tax Year

IRonMaN

Level 15

What transfer? The entity hasn’t changed other than what tax form it files.

Slava Ukraini!

T

TCl123Author

Level 3

I have read differing ways of handling this. One suggested the 351 to reflect the transferring in of the basis to the S Corporation. So, are you saying that all that I need to do is record the M-1 addition for the basis transferred over and continue on?

IRonMaN

Level 15

My beginning balance sheet would be the same as the prior year ending balance sheet.

Slava Ukraini!

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