Personal Finance (Not Investing) • New S CORP owner

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There's zero legal work to make an S election.

My point wasnt that accountants are out forming legal entities (if they are, theyre likely involved in criminal activity), it was that in the area of single owner S corporations, its effectively an entity mill where the owner will either do a simple LLC filing (these can be done by in many states in an hour) or on a very small engagement with a law firm that may not have any tax expertise at all.

There’s some work, including the discussion as to whether it
makes sense.

If you use a law firm that doesn’t have any tax expertise for a tax matter you shouldn’t expect a good result.

This was all in the context of a CPA firm pitching S corporation structures. They pitch the benefits, that work has been "done" so its not re-done as the owner has already been convinced of the benefits.

I didnt mean to suggest that there isnt any work in determining whether to be an S corp, but that is not legal work nor is the filing of a Form 2553. It is tax work that could be done by a number of different types of firms (law, accounting, advisory).

I dont think thats a good way to go about it, but it is prevalent in the market given the number of S corps out there that dont provide any material benefit (especially net of compliance costs).

Statistics: Posted by soxfan10 — Mon Aug 19, 2024 8:41 pm — Replies 64 — Views 2913

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