Ask Question
25 January, 22:42

On February 10, Year 1, Ace Corp., a calendar-year corporation, elected S corporation status and all shareholders consented to the election. There was no change in shareholders in Year 1. Ace met all eligibility requirements for S status during the preelection portion of the year. What is the earliest date on which Ace can be recognized as an S corporation

+1
Answers (1)
  1. 25 January, 23:01
    0
    January 1, 2009

    Explanation:

    The requirement is to determine the earliest date on which Ace Corp. (a calendar-year corporation) can be recognized as an S corporation. Generally, an S election will be effective as of the first day of a taxable year if the election is made on or before the 15th day of the third month of the taxable year. Since there was no change in shareholders during the year, all of Ace's shareholders consented to the election, and Ace met all eligibility requirements during the preelection portion of the year, its election filed on February 10, 2009, is effective as of January 1, 2009.

    Note that if either a shareholder who held stock during the taxable year and before the date of election did not consent to the election, or the corporation did not meet the eligibility requirements before the date of election, then an otherwise valid election would be treated as made for the following taxable year.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “On February 10, Year 1, Ace Corp., a calendar-year corporation, elected S corporation status and all shareholders consented to the ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers