S Corp Rejection

Technical topics regarding tax preparation.
#1
Posts:
6
Joined:
24-Feb-2021 6:56pm
Location:
Virginia
Hello everyone. I have a client who I prepared an 1120-S, e-filed it, and it was rejected. The reason for the rejection is as follows "The return type indicated in the return header must match the return type established with the IRS for the EIN." The client then sends me a notice called 3853C saying that they don't have any record that he ever filed a 2553. He did his taxes in 2020 for 2019 return elsewhere, and the copy he provided me stated that the person who prepared his taxes, under the 1120-S he checked the box "is the corporation electing S corporation beginning this tax year" and selected "yes" and attached a 2553 with late filing reason "I was not aware of the election." My dilemma is if they filed electronically, including the 2553 or if it was mailed. I need to ask the client this, but I am not sure if the 2553 can be e-filed with the 1120-S?

Anyways, now this year, he is being rejected, so what options are on the table? The rejection reason gives me a number to call, which seems to be the e-services number for the IRS.

Thank you.
 

#2
Posts:
1246
Joined:
22-Apr-2014 5:22pm
Location:
Upstate, NY
Ugh, had this on more than a few clients in the past. Get POA, have the 2553 signed by the client, then call1-800-829-4933...I think....it’s been a while.

. Given COVID, if the 2553 was paper filed, who knows where it is. THey will have you fax the POA and 2553 and they can do something to allow efile. Unfortunately , it generally take a while to get that thru the system so at this point you will have to extend. I can’t remember exactly how long it took, but I feel like it was maybe 3-4 weeks...

Again, been a while since I did this so maybe it’s changed. I hope I don’t send you on a wild goose chase, but since there were no other responses......
 

#3
HowardS  
Posts:
2820
Joined:
21-Apr-2014 3:12pm
Location:
Southern Pines, NC
Good luck. I faxed a 2553 in July 2020 and paper filed it Dec 2020. Still haven't heard anything.
Retired, no salvage value.
 

#4
Posts:
1246
Joined:
22-Apr-2014 5:22pm
Location:
Upstate, NY
HowardS wrote:Good luck. I faxed a 2553 in July 2020 and paper filed it Dec 2020. Still haven't heard anything.


I haven’t seen an s-Corp letter from any new scorp in a decade. But what does happen periodically is a client who has successfully filed as an scorp for 5-6 years will all of the sudden reject. It’s so annoying.
 


Return to Taxation



Who is online

Users browsing this forum: ajt1970, artp, dellpaul, deniz, eric1032, Frankly, Google [Bot], Google Adsense [Bot], GSTaxTalk, JAD, JoJoCPA, JR1, ManVsTax, MAPCPA60, SALYstrikesagain, Seaside CPA, TheGrog, Trailman423, wallbobbyc and 208 guests