If my understanding is correct, both an S corporation and partnership/SMLLC recognizes revenue based on cost of performance whereas a C corporation is market based.
I'm evaluating whether a SMLLC client should elect S status and it currently has some NYC-based clients. All of the work is all performed outside NYC so electing S status wouldn't trigger the NYC 8.85% tax.
If NYC were to change its laws regarding revenue of S corporation to align with C corporations, it would trigger the 8.85% tax and any benefit an S corporation would offer for this client would disappear.
Given the NYC deficit, has anyone read or heard whether NYC is considering a change in revenue-recognition laws for S corporations to market based?