Where to Fax Form 2553: Essential IRS Fax Numbers

Key Takeaways

• Form 2553 grants S corporation status to small businesses to prevent double taxation and to take advantage of pass-through taxation principles.

• To fax Form 2553 to the IRS you must use the appropriate IRS fax number depending on the location of the business entity and include a cover sheet with identification information. 

• Using an online fax service like Fax App is the most straightforward and secure way to fax Form 2553 and provides benefits like scanning, cloud storage, and delivery notifications.

What’s S Corporation Status

For small businesses looking for relief from double taxation, S corporation status is the solution. Form 2553 is the application that allows companies to avoid C corporation tax liabilities and take advantage of pass-through taxation by filing for S corp status. This special status allows business income to be taxed only once, on the individual tax return of the business owner.

An entity must meet certain formal requirements to be eligible for S corporation status. The criteria are listed on the IRS website here. The requirements are as follows:

1. Type of Entity: Corporation must be a domestic corporation. Banks, insurance companies, and certain foreign financial institutions are ineligible to make the S election.
   
2. Type of Shareholder:
   • Shareholders must be an individual, certain trusts and estates. Partnerships, corporations and nonresident aliens are ineligible to be shareholders.
   • A maximum of 100 shareholders is allowed. Family members are counted as one shareholder.
3. Class of Stock: There must be a single class of stock. There may be nonvoting preferred stock, but no other distinctions in distribution or liquidation privileges.
   
4. File Form 2553:: Corporation must file Form 2553 (Election by a Small Business Corporation) with the Internal Revenue Service (IRS). The form must be signed by every shareholder and delivered:
   • Any time before the close of the tax year which the election is to take effect, or
   • On or before the 15th day of the 3rd month after the beginning of the tax year for which the election is to take effect.
     
5. Shareholder Approval: The S corporation election must be consented to by all shareholders.
6. Domestic Corporation: Corporation must have been formed or organized in the United States or under the laws of the United States or any one of the States.

Obtaining S corporation status by filing Form 2553 can be challenging. Companies must file with the IRS no later than March 15th if they use a calendar year for their fiscal year—a deadline these companies have memorized. For LLCs, making this election successfully converts the company to a partnership for federal tax purposes. Additionally, LLC members can take a salary in addition to dividends from the business earnings to reduce the highest possible self-employment taxes. With so much on the line financially, delivering Form 153 on time is crucial for companies using this strategy for tax optimization.

What is IRS Form 2553?

IRS Form 2553 is unique among tax applications in that it allows small businesses to take advantage of S corporation status, which allows:

• Profits and losses to pass through the corporate veil directly to the individual shareholders’ tax returns, avoiding double taxation.

• Simplify operation complexities.

• Align tax strategy with business objectives.

The benefits don’t stop at tax reductions and can include a variety of financial perks for small businesses. To learn more about Form 2553, you can visit this page on the IRS website.

IRS Fax Numbers by State

To prevent your documents from being lost at sea, it’s best to check either the IRS website or this handy list of the appropriate fax numbers to use based on your location:

Use this fax number: 855-887-7734 if you’re in the states of: Connecticut, Delaware, District of Columbia, Georgia, Illinois, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Vermont, Virginia, West Virginia, Wisconsin

Use this fax number: 855-214-7520 if you’re in the states of: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Hawaii, Idaho, Iowa, Kansas, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Texas, Utah, Washington, Wyoming

Using the correct fax number as listed will ensure against accidental misrouting and delivers secure, confidential documents to the IRS. When you’re ready to fax Form 2553 to the IRS, consider the cover sheet as your notice to the agency of how you want them to receive your documents. The cover sheet must include your name, phone number, and your Employer Identification Number so your tax filing documents don’t get buried under the mountain of paperwork they receive daily.

How to Fax Form 2553 Online

In the past, lugging around a bulky machine was required to send a fax. Now, sending Form 2553 by online fax is preferable because it combines the reliability of traditional faxing with the convenience of today’s technological innovations.

Regardless if you’re in the office or on the move, a service like Fax App provides an intuitive and secure way for you to transmit your form effortlessly.

Summary

As we conclude our detailed exploration of sending Form 2553 via fax, it’s apparent how pivotal this step is for small businesses wishing to attain the benefits of S corporation status. The process involves careful attention from choosing the appropriate fax number to utilizing modern online fax services – each component crucial for a favorable election.