Level 5

Do I need to file a tax return for s corp if I had no activity?

Forum|Forum|1 year ago
March 10, 2025
2 replies
15 views

Friends, Romans Countrymen (and women) lend me your beers....

So I have a client who I filed a 1120-S Income Tax Return for an S Corporation last year. 2023 was his first year filing a Corporate tax return. This year however, he went back to being a wage earner and had no activity (revenues or expenditures) in the corporation. He does have depreciation but it's not much.

Does he need to file a Income Tax Return for an S Corporation this year (2024)?

Any advice or direction would be greatly appreciated.

PPECPA

abctax55

Level 15

Yes, unless the Corp has been dissolved. Especially if a CA corporation - the FTB always wants their minimum tax

And if not active, the depreciation should possibly (probably?) be suspended.

NMI

(and I'm a wine drinker)

HumanKind... Be Both

P

PPECPAAuthor

Level 5

Thanks abctax55, that does answer my question.

Thanks again

abctax55

Level 15

YVW

HumanKind... Be Both

qbteachmt

Level 15

"He does have depreciation but it's not much."

Is that asset in use personally, such as, the taxpayer is now an employee and using it there? Because it doesn't depreciate if it's not in use by the corporation, and if it is in use but not by the corporation, someone just absconded with a corporate asset! (ha ha ha) It should be properly disposed of with residual value, in other words.

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