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Old 02-02-2011, 03:33 PM
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Join Date: Feb 2011
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inactive S-Corporation

I have an S-Corporation that has not had any activity for the last 5 years. I have completed returns with no activity every year. I am wondering if I can make it an "inactive return" so there will be no filing requirement or should it be dissolved?

Any thoughts. Thanks and happy tax season!! :-)



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Old 02-02-2011, 03:43 PM
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I think you should have your CPA or Tax Professional formally dissolve your corporation as soon as possible. In California, New York and New Jersey for example, being inactive does not mean that you are not required to file a Tax Return and avoid paying the minimum franchise taxes.

If you are in New Jersey for example, you should first file a Final Year Corporation Tax Return for 2010 on the Federal Tax Return, and then file a dissolution with your State as soon as possible. Thereafter, for 2011 you should file an Inactive Tax Return only for NJ State. You would not have to file a Tax Return for the Federal in 2011!

I think you may be responsible for the prior years minimum filing taxes as well!



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Old 02-02-2011, 03:47 PM
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Thanks for the response LongBeach. This corporation is in Pennsylvania so there is not a minimum tax issue, but I will look into dissolving the S-Corp anyway.

Thanks again!



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