The S-Corp election is one of the most valuable tax moves available to profitable LLC owners — but it comes with a hard deadline. Miss it and you wait a full year. Here’s exactly when to file, how to file, and what happens if you’re late.

The S-Corp Election Deadlines

There are two scenarios:

• New entity: File Form 2553 within 75 days of forming your LLC or corporation. This gets the S-Corp election effective for the current tax year.
• Existing entity: File by March 15 to have S-Corp status apply to the current calendar tax year. File after March 15 and it applies to the following year.

Why the Deadline Matters

The S-Corp election reduces self-employment taxes on profitable businesses by allowing you to split income between a salary (subject to SE tax) and distributions (not subject to SE tax). At $100,000 in profit with a $60,000 salary, you save SE tax on $40,000 — roughly $6,000 a year. At $200,000 profit, the savings compound further. The election is prospective — it only applies from the effective date forward. That’s why missing the March 15 deadline means leaving real money on the table for an entire year.

How to File Form 2553

1. Download Form 2553 from irs.gov
2. Complete Part I — entity information, election date, tax year
3. Complete Part I, Column K — shareholders must sign and date
4. For LLCs: also complete Part II confirming LLC status
5. File by fax or mail to the appropriate IRS service center (listed in the Form 2553 instructions based on your state)
6. Keep a copy with your business records — the IRS mails a CP261 acceptance notice

What If You Miss the Deadline?

The IRS has a late election relief procedure under Revenue Procedure 2013-30. If you have reasonable cause for missing the deadline and have been operating as if the S-Corp election was in effect, you may qualify to file late and have it treated as timely. This isn’t guaranteed — but it’s worth pursuing with a CPA if you missed the window. Don’t just write off the year without exploring it.

Frequently Asked Questions