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A few closely related topics & pages From Bob Parrish CPA PC:
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Letter - What this idea is about From Bob Parrish CPA PC
| Poor old Sue Started a set of books anew without reading these lines few and now Sue is in a Stew |
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Engagement Status Letter From Bob Parrish
CPA PCYou have not engaged Bob Parrish CPA PC, Bob Parrish CPA, pro1040, Consulting on line, any related parties, or the ISP to perform any services for you or offer you advice. This entire site is for educational or informational purposes only. You are not to use the forms, concepts, strategies, or knowledge without assistance from a professional. The author, the corporation, the ISP, Bob Parrish CPA, Bob Parrish CPA, P.C. or other parties related to those or this site do not guarantee or warrantee in any manner the suitability, usefulness, accuracy, timeliness, or results of any portions of this site, nor the links contained in this site which link to other areas. At times, information is taken from other sources and is believed to be accurate, but no verification or confirmation is performed. Furthermore, if any federal or state law invalidates a portion of this disclaimer, the other portions still apply. In addition, any allegations or actions are restricted to arbitration only and must be arbitrated by the Better Business Bureau in Sarasota Florida. Reading of these pages constitutes complete acceptance and agreement with all disclaimer provisions on all pages of this site. ....... Thursday, February 22, 2007 02:27 AM
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Rev Proc 97-40
Sub S Elections
Top - Summary - Purpose - Background - Scope - Eligibility - Procedures - Relief - Effective Date - Top Of Rev Proc
Rev. Proc. 97-40
1997-33 I.R.B. 50
Section 1362 -- S Corporation Elections
Statement of Procedural Rules
Summary
IRS ISSUES NEW PROCEDURE FOR LATE S CORPORATION ELECTIONS.
The Service has announced (Rev. Proc. 97-40; IR-97-34) a new procedure for
requesting relief for late S corporation elections. Rev. Proc. 97-40 applies
only to corporations (1) that have not filed a timely S corporation election
under section 1362(a)(1), and (2) for which an S corporation election is filed
within six months of the original due date of the election.
Top Of Rev Proc
To obtain relief under the new procedure, eligible corporations must, within six
months of the original election due date, file a completed Form 2553,
"Election by Small Business Corporation," with the applicable service
center. The form must be signed by a corporate officer and all persons who were
shareholders during the period that (1) began on the first day of the tax year
for which the election takes effect; and (2) ends on the day the election is
made. Additionally, the top of the form must state "FILED PURSUANT TO REV.
PROC. 97-40." A statement explaining the reason for the failure to file the
S corporation election must also be attached. If, after reviewing the completed
application, the Service decides there was reasonable cause for the failure to
file a timely election, it will notify the corporation of that fact.
Top Of Rev Proc
To be eligible for relief under the procedure, a corporation must (1) fail to
qualify as an S corporation solely because the Form 2553 was not filed timely
under section 1362(b)(1); and (2) the due date for the tax return (excluding
extensions) for the first year the corporation intended to be an S corporation
has not passed.
As a result of the new procedure, the Service says, corporations seeking relief
from late S corporation elections no longer need to apply for a private letter
ruling or pay a user fee. Ineligible corporations, or corporations denied relief
under the procedure, however, must still apply for a private letter ruling under
Rev. Proc. 97-1, 1997-1 IRB 11, if they desire relief. Similarly, the Service
says, the procedure does not provide relief for late shareholder elections,
including qualified subchapter S trust elections or electing small business
trust elections.
Rev. Proc. 97-40 is effective for all qualifying applications for relief,
including those applications now being considered by the IRS.
This revenue procedure provides guidance under section 1362(b)(5) of the Internal Revenue Code for requesting relief for late S corporation elections that are filed within 6 months of the due date of the election.
Section 1361(a)(1) defines an "S corporation," with
respect to any taxable year, as a small business corporation for which an S
election is in effect for that year.
Section 1362(a)(1) provides that, except in a situation described in section
1362(g), a small business corporation may elect to be treated as an S
corporation.
Section 1362(b)(1) provides that the corporation may make an election to be
treated as an S corporation (A) at any time during the preceding taxable year,
or (B) at any time during the taxable year and on or before the 15th day of the
3rd month of the taxable year. Under section 1362(b)(3), if an S corporation
election is made for a taxable year after the 15th day of the 3rd month of that
taxable year and on or before the 15th day of the 3rd month of the following
taxable year, then the S corporation election is treated as made for the
following taxable year.
Section 1362(b)(5) provides that if (A) an election under section 1362(a) is
made for any taxable year (determined without regard to section 1362(b)(3))
after the date prescribed by section 1362(b) for making the election for the
taxable year or no election is made for any taxable year, and (B) the Secretary
determines that there was reasonable cause for the failure to timely make the
election, the Secretary may treat the election as timely made for the taxable
year (and section 1362(b)(3) shall not apply).
This revenue procedure provides a special procedure to request relief for a late
S corporation election. This revenue procedure applies only to a corporation (1)
that has not filed a timely S corporation election under section 1362(a)(1), and
(2) for which an S corporation election is filed within 6 months of the original
due date for the election. This revenue procedure does not provide relief for
late shareholder elections including a qualified subchapter S trust (QSST)
election or electing small business trust (ESBT) election. This special
procedure is in lieu of the letter ruling procedure that is used to obtain
relief for a late S corporation election under section 1362(b)(5). Accordingly,
user fees do not apply to corrective action under this revenue procedure. A
corporation that is not eligible for relief under this revenue procedure, or is
denied relief, may request relief by applying for a private letter ruling. The
procedural requirements for requesting a private letter ruling are described in
Rev. Proc. 97-1, 1997-1 I.R.B. 11 (or its successor).
Top Of Rev Proc
.01 ELIGIBILITY FOR RELIEF. A
corporation is eligible for relief if it meets the following requirements:
(1) The corporation fails to qualify as an S corporation solely because the Form
2553 (Election by a Small Business Corporation) was not filed timely pursuant to
section 1362(b)(1); and
(2) The due date for the tax return (excluding extensions) for the first year
the corporation intended to be an S corporation has not passed.
.02 PROCEDURAL REQUIREMENTS FOR RELIEF.
Within 6 months of the original due date for the S corporation election, the
corporation must file with the applicable service center a completed Form 2553,
signed by an officer of the corporation authorized to sign and all persons who
were shareholders (or deemed to have been shareholders) at any time during the
period that began on the first day of the taxable year for which the election is
to be effective and ends on the day the election is made. The Form 2553 must
state at the top of the document "FILED PURSUANT TO REV. PROC. 97-40."
Attached to the Form 2553 must be a statement explaining the reason for the
failure to file a timely S corporation election.
.03 RELIEF FOR LATE S CORPORATION ELECTIONS. Upon receipt of a completed application requesting relief under this revenue procedure, the Internal Revenue Service will determine if there was reasonable cause for the failure to file a timely S corporation election and will notify the corporation of the result of the reasonable cause determination.
This revenue procedure is effective for all applications for
relief satisfying the requirements of section 4 of this revenue procedure,
including those applications now being considered by the Service.
The collection of information contained in this revenue procedure has been reviewed and approved by the Office of Management and Budget in accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under control number 1545-1548.
An agency may not conduct or sponsor, and a person is not required to respond
to, a collection of information unless the collection of information displays a
valid control number.
The collection of information in this revenue procedure is in Section 4.02. This
information is required to be submitted to the applicable service center in
order to obtain relief for late S corporation elections. This information will
be used to determine if the reasonable cause requirement in section 1362(b)(5)
has been met. The collection of information is required to obtain a benefit. The
likely respondents are business or other for-profit institutions.
Top Of Rev Proc
The estimated total annual reporting burden is 200 hours.
The estimated annual burden per respondent varies from .5 hours to 1.5 hours,
depending on individual circumstances, with an estimated average of 1 hour. The
estimated number of respondents is 200.
The estimated annual frequency of responses is one.
Books or records relating to a collection of information must be retained as
long as their contents may become material in the administration of any internal
revenue law. Generally, tax returns and tax return information are confidential,
as required by 26 U.S.C. 6103.
DRAFTING INFORMATION
The principal author of this revenue procedure is Mark D. Harris of the Office
of Assistant Chief Counsel (Passthroughs and Special Industries). For further
information regarding this revenue procedure contact Mr. Harris at (202)
622-3050 (not a toll-free call).
Tax
Killers 
From Bob Parrish CPA PC
This is about Activity Based Taxplanning - maximizing deductions, minimizing cash outlay and maximizing the amount of cash retained and the net worth. Activity Based Taxplanning (ABT) is a methodology developed by Bob Parrish CPA, that assists people with the tax issues by focusing on the activity (or actions - events) that are being undertaken or contemplated (or have already taken place). The, research is compiled from the myriad of sources to help you complete the activity with the least tax cost, while maintaining compliance the tax laws, other laws and regulations and place yourself in a position to protect your objectives.
Tax is a subject that many view in order to cut costs. Taxes are a cost just as any other cost. It happens this cost is somewhat intangible and is defined by legislation without a tangible item to view and control. The money is spent and the control of the expenditure is more appropriately administered by someone trained in the law.
Cost
Killers 
From Bob Parrish CPA PC
This is about Activity Based Costing - methods to cut costs, management accounting, management information systems, decision support systems - in general about being a manager.
Preparing for your CPA, attorney, or preparing to start
your own What to gather - From Bob Parrish CPA PC
Entrance Interview
Exit Interview
From Banking Records
From Customer Records
From Signed Documents
From Your Other Business, or Financial Records
From Corporation or Organization Records (meetings, etc.)
What to do
Forms - checklists, time-line to do, etc. Assistance - What
To Do - From Bob Parrish CPA PCAssistance - What to do
Forms - Checklists - Etc.
Spreadsheets & Computations From Bob
Parrish CPA PC
Spreadsheet #1
Contracts, Trusts, etc. From Bob Parrish CPA PCAgreement #1
Reports
Required From Bob Parrish CPA PCReport #1
Checklists for Deployment From Bob Parrish CPA PCChecklist #1
Checklist for Monitoring From Bob Parrish CPA PCChecklist #1
Financial Accounting: Bookkeeping & Financials From
Bob Parrish CPA PCFinancial Statement Presentation
Notes to Financial Statements
How to Make Entries
What Kind of Records to Keep
Bookkeeping Methods - Cash, Accrual and Other
How the Business Entity Affects the Recording
Sole Proprietor
Corporation - C & S
Partnerships - General, Limited, Limited Liability Company, Registered Limited Liability Partnership or Company
Trusts
Tax Exempt
Compliance - what is required for protection, defense, etc.
From Bob Parrish CPA PCCompliance Checklist
Alerts
& Dangers - Risks, Asset Protection, IRS Defense From Bob
Parrish CPA PCAction Checklist
Alerts & Dangers - Risks
Asset Protection
Your Defense
