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Form 2553: How to Make, Time and Fix an S Corporation Election

9/27/2026

Form 2553 is a four-page form, and most of it is easy. The election still fails more often than it should, for three reasons: it is filed outside the window, a required shareholder never signs a consent, or the entity was never eligible in the first place. Each of those turns a client who believes it is an S corporation into a C corporation or a partnership, sometimes for years before anyone notices.

This guide follows the order a practitioner actually works in: confirm eligibility, pick the effective date, collect the consents, file and prove filing, and, when something went wrong, use the late-election relief in Rev. Proc. 2013-30. It also covers the most common version of the question, how to convert an LLC to an S corporation, because for an LLC, Form 2553 does two jobs at once.

All references to the instructions are to the Instructions for Form 2553 (Rev. December 2020), which are used with the December 2017 revision of the form. Check IRS.gov/Form2553 for any later developments before filing.

Step 1: Confirm the Entity Is Eligible

A corporation, or an entity eligible to elect to be treated as a corporation, can elect S status only if it meets all of the tests in Section 1361. Per the instructions, it must:

  • Be a domestic corporation or a domestic entity eligible to elect corporate treatment.
  • Have no more than 100 shareholders. A married couple and their estates count as one shareholder, and all members of a family (as defined in Section 1361(c)(1)(B)) and their estates can be treated as one shareholder.
  • Have only eligible shareholders: individuals, estates, certain exempt organizations, and certain trusts. A trust usually needs to qualify as a grantor trust, a qualified subchapter S trust (QSST) or an electing small business trust (ESBT).
  • Have no nonresident alien shareholders (other than as potential current beneficiaries of an ESBT).
  • Have only one class of stock, disregarding differences in voting rights. A corporation generally has one class of stock if all outstanding shares confer identical rights to distribution and liquidation proceeds.
  • Not be an ineligible corporation, such as a bank using the reserve method for bad debts or certain insurance companies.

For an LLC, the one-class-of-stock test needs a close read of the operating agreement. Provisions that give members different rights to distributions or liquidation proceeds, which are common in agreements drafted for partnership taxation, can create a second class of stock. Amend the agreement before the election takes effect, not after.

Step 2: Choose the Effective Date (Line E)

Line E is the date the election is to take effect, and it drives every deadline that follows.

For a new entity electing for its first tax year, enter the earliest of the date the entity first had shareholders (owners), first had assets, or began doing business. Pick this date carefully. A company formed in one month that opens a bank account and deposits capital the next has started its first tax year when it first had assets, not when it made its first sale.

For an existing entity, enter the first day of the tax year for which the election should be effective. If the entity is also changing its tax year, the instructions explain how to handle the short year and when Form 1128 is needed.

Line F asks for the tax year. Most S corporations use a calendar year. A fiscal year requires Part II and a basis for it: a natural business year, an ownership tax year, a Section 444 election, or a business purpose ruling request. If you check the business purpose box (Q1), expect a longer determination period.

Step 3: File Within the Window

The instructions give two windows. Form 2553 must be filed:

  • No more than 2 months and 15 days after the beginning of the tax year the election is to take effect, or
  • At any time during the tax year preceding the tax year it is to take effect.

The 2-month period is counted precisely: it begins on the day of the month the tax year begins and ends with the close of the day before the numerically corresponding day of the second calendar month after that. If there is no corresponding day, use the close of the last day of the month. The instructions' own examples:

  • A new calendar-year corporation whose first tax year begins January 7: the 2-month period ends March 6, and 15 days after that is March 21. The window runs from January 7 to March 21. Because the corporation had no prior tax year, an election filed before January 7 is not valid.
  • An existing calendar-year C corporation electing for the next year: the 2-month period ends February 28 (29 in a leap year), and 15 days later is March 15. The election can be filed any time during the prior year or by March 15 of the election year.

Two practical points. First, "2 months and 15 days" is not the same as "75 days," and in short months the difference matters, so count it the way the instructions do. Second, an election filed after the window is not void. It is generally treated as effective for the following tax year, which may not be what the client wanted. If the client needed it effective for the current year, you need late-election relief, covered below.

Step 4: Get Every Required Consent

The election is valid only if every shareholder required to consent actually consents. Each one signs and dates column K, or a separate consent statement attached to the form.

Who must consent depends on when you file:

  • For an election filed before the effective date, only shareholders who own stock on the day the election is made need to consent.
  • For an election filed on or after the effective date, all shareholders or former shareholders who owned stock at any time from the effective date through the day the election is made must consent. A partner who left in February still has to sign a March election that is effective January 1.

Special consent rules to watch:

  • Community property: if a shareholder and spouse have a community interest in the stock or the income from it, both spouses must consent.
  • Co-owners: each tenant in common, joint tenant and tenant by the entirety must consent.
  • Minors: consent is made by the minor or a legal representative (or a natural or adoptive parent if no legal representative has been appointed).
  • Trusts: for a QSST, the deemed owner consents; for other trusts, the person treated as the shareholder under Section 1361(c)(2)(B) consents. A QSST election is made in Part III, and only for stock transferred to the trust on or before the date the S election is made.
  • Disregarded LLC shareholders: if a single-member LLC that is disregarded owns the stock, list its owner, who must be an eligible shareholder.

The form must also be signed by an officer authorized to sign (president, vice president, treasurer, assistant treasurer, chief accounting officer or another authorized officer). An unsigned Form 2553 is not treated as timely filed.

If the election was timely but a shareholder's consent was missed, the regulations provide a fix for a timely election with a missing consent; see Regulations section 1.1362-6(b)(3)(iii), cited in the instructions.

Converting an LLC to an S Corporation

"How do I convert my LLC to an S corp?" is usually not a question about state law. The LLC stays an LLC. What changes is its federal tax classification.

An LLC is an entity eligible to elect its classification. Under the instructions, an eligible entity that meets the S tests and timely files Form 2553 is treated as a corporation as of the effective date of the S election and does not need to file Form 8832. One form makes both elections: corporate classification and S status.

Things to settle before filing for an LLC:

  1. The LLC keeps its EIN if it already has one. A single-member LLC that had no EIN of its own (because it used the owner's SSN) will need one.
  2. Operating agreement. Review for the single-class-of-stock problem described in Step 1. Partnership-style capital account, preferred return and liquidation provisions are the usual offenders.
  3. Ownership disclosure. The form asks for shares; an entity without stock, such as an LLC, enters each owner's percentage and the date it was acquired.
  4. What happens to the old tax treatment. For a multi-member LLC that has been filing Form 1065, the change in classification is treated as a contribution of the partnership's assets and liabilities to a new corporation in exchange for stock, followed by a distribution of that stock to the partners. That is generally tax-free, but liabilities in excess of basis can produce gain, and the final partnership return is due for the short year before the conversion. Our post on the partnership tax return deadline covers the Form 1065 calendar.
  5. Once the election is effective, owners who work in the business must be paid wages. Set this up before the first payroll date; our post on payroll for an S corp election walks through registrations and reasonable compensation.
  6. State recognition. Most states follow the federal S election automatically. Some require a separate state election or do not recognize S status for some taxes; New York City, for example, does not recognize the S election for its general corporation tax. Check the state and locality before promising the client a particular result.

Step 5: File and Prove Filing

The instructions direct the original form (no photocopies) to be mailed, or faxed, to the IRS service center listed for the entity's principal business location. If you fax it, keep the original with the corporation's permanent records. Certain late elections can instead be attached to Form 1120-S, as described in the relief section below. Designated private delivery services can be used; confirm the street address on IRS.gov.

Expect a determination within about 60 days. If box Q1 (business purpose fiscal year) is checked, expect roughly another 90 days. The instructions say to follow up if you have not been notified of acceptance or nonacceptance within 2 months of filing (5 months if Q1 was checked).

Keep proof of filing. If the IRS questions whether the form was filed, acceptable proof includes a certified or registered mail receipt (timely postmarked) or its private delivery service equivalent, a Form 2553 with an accepted stamp or stamped received date, or an IRS letter stating the form was accepted. Keep the acceptance letter in the permanent file; it is the document you will need at sale, at a lender's request, or in an examination.

Do not file Form 1120-S for any year before the election takes effect. Keep filing the entity's existing return type until it does.

Fixing a Late Election: Rev. Proc. 2013-30

Rev. Proc. 2013-30 (2013-36 I.R.B. 173) is the simplified relief procedure for late S elections, as well as late QSST, ESBT and entity classification elections. It avoids a private letter ruling if the requirements are met.

Relief for a late election filed by a corporation

A corporation can request relief if:

  1. It intended to be an S corporation as of the date on line E.
  2. It fails to qualify as of that date solely because Form 2553 was not timely filed.
  3. It has reasonable cause for the late filing and acted diligently to correct it once discovered.
  4. The form is filed within 3 years and 75 days of the line E effective date.
  5. It can provide statements from all shareholders during the period between the effective date and the filing date that they reported their income consistently with the S election for that year and all later years. The column K consent statement satisfies this.

The reasonable cause explanation goes on line I or an attached statement. "Our prior adviser told us it had been filed" or "the owner relied on a formation service that did not file the election" are typical facts; the explanation should say what happened and what was done once the problem was found.

An exception to the 3-years-and-75-days limit. A corporation that meets requirements 1 through 3 but is past the time limit can still request relief on Form 2553 if:

  • The corporation and all its shareholders reported their income consistently with S status for the intended first year and every later year;
  • At least 6 months have elapsed since the corporation filed its return for the first year it intended to be an S corporation; and
  • Neither the corporation nor any shareholder was notified by the IRS of any problem with S status within 6 months of the date the Form 1120-S for the first year was timely filed.

Relief for an LLC that also missed corporate classification

An eligible entity (such as an LLC) that intended to be an S corporation but failed to qualify as a corporation because its Form 2553 was late can request relief for both the classification and the S election, subject to similar requirements, including the 3-years-and-75-days limit and the shareholder statements. Part IV of Form 2553 contains the representations that must be attached to a late corporate classification election that is meant to take effect on the same date as the late S election.

How to file a late election

  • Write "FILED PURSUANT TO REV. PROC. 2013-30" in the top margin of page 1 of Form 2553.
  • File it separately, or attach it to Form 1120-S. If attached, write "INCLUDES LATE ELECTION(S) FILED PURSUANT TO REV. PROC. 2013-30" in the top margin of page 1 of the Form 1120-S. The election can go with the current Form 1120-S if all earlier ones have been filed, or with the first Form 1120-S for the year that includes the effective date if filed together with any other delinquent returns.
  • If the requirements are not met, the corporation generally has to request a private letter ruling and pay a user fee under the annual revenue procedure that governs rulings.

After the Election: Termination and Re-Election

An election stays in effect until it is revoked or terminated. A revocation needs consent of shareholders holding more than half of the shares. An election also terminates automatically if the corporation stops qualifying, for example by admitting an ineligible shareholder or creating a second class of stock, or, for a corporation with C corporation earnings and profits, by having excess passive investment income for three consecutive years. After a termination or revocation, IRS consent is generally required to re-elect before the fifth tax year after the first tax year in which the termination took effect.

That five-year rule is why eligibility monitoring belongs in the annual engagement checklist: share transfers, new trusts, operating agreement amendments and changes in shareholder residency can all break the election without anyone filing anything.

A Filing Checklist

  • Eligibility tests confirmed, including a read of the operating agreement for distribution and liquidation rights.
  • Line E effective date chosen from the earliest of shareholders, assets or start of business (new entity) or the first day of the target year (existing entity).
  • Deadline counted using the 2-months-and-15-days method.
  • Officer signature and every required shareholder consent, including spouses with community property interests and former shareholders where the election is filed after the effective date.
  • Filing method that produces proof of filing.
  • Follow-up diary set for 60 days (or 5 months with Q1).
  • Payroll set up before the first pay date after the effective date.
  • State and local election requirements checked.

Learn the S Corporation Rules That Follow the Election

The election is the first step, not the last. Basis tracking, distributions, shareholder compensation and the built-in gains rules for converted C corporations are where the ongoing work and the ongoing risk sit. Our S Corporations course is the place to start, and practitioners who regularly advise on elections and S corporation transactions can continue with the Certificate in S Corp Transactions.

Frequently Asked Questions

When is Form 2553 due?

No more than 2 months and 15 days after the beginning of the tax year the election is to take effect, or at any time during the preceding tax year. For a calendar-year corporation electing for an existing entity's next year, that means by March 15. For a new corporation, the window starts on the first day of its first tax year, the earliest of when it first had shareholders, had assets or began doing business. An election before that start date is not valid.

How do I convert an LLC to an S corp?

File Form 2553 for the LLC. An eligible entity that meets the S corporation tests and timely files Form 2553 is treated as a corporation from the election's effective date, so a separate Form 8832 is not needed. The LLC remains an LLC under state law. Before filing, review the operating agreement for provisions that could create a second class of stock, confirm every member is an eligible shareholder, and set up payroll for owners who work in the business.

What happens if Form 2553 is filed late?

A late election is generally effective for the following tax year. If the client needed it effective earlier, Rev. Proc. 2013-30 allows relief when the only problem was late filing, there was reasonable cause, the corporation acted diligently once it found the error, and the form is filed within 3 years and 75 days of the intended effective date with consistent-reporting statements from all shareholders. Write "FILED PURSUANT TO REV. PROC. 2013-30" at the top of the form.

Who has to sign Form 2553?

An authorized corporate officer signs the election, and every shareholder required to consent signs column K or a separate consent statement. If the election is filed after its effective date, anyone who owned stock at any time between the effective date and the filing date must consent, including former shareholders. Both spouses must consent where they have a community property interest in the stock, and each co-owner of jointly held stock must consent.

How long does it take the IRS to accept Form 2553?

The instructions say the corporation should generally receive a determination within 60 days of filing. If the corporation requested a fiscal year based on a business purpose (box Q1), allow roughly another 90 days. If you have not received notice of acceptance or nonacceptance within 2 months of filing, or 5 months with Q1 checked, the instructions direct you to follow up with the IRS. Keep the acceptance letter permanently.

Can a late S election be attached to Form 1120-S?

Yes, for a late election filed under Rev. Proc. 2013-30. Write "INCLUDES LATE ELECTION(S) FILED PURSUANT TO REV. PROC. 2013-30" at the top of the Form 1120-S. The election can be attached to the current-year 1120-S if all earlier returns have been filed, or to the first 1120-S for the year that includes the effective date if filed together with any delinquent returns. It can also be filed on its own.