Another S Corp or three

[erchess]

This is a different S Corp (actually three of them) with a different owner than in my other S Corp thread today.

The guy is sole owner of three S corps for which I am getting ready to file no activity returns. They have been this way for several years and the rationale for not closing them is that one he may revive himself and the others he hopes to sell because they have really cool names in his opinion. Owner is basically broke having even been through bankruptcy that completely erased a ton of debt. One corp has its corp and franchise taxes to NC paid up through last year's return and the other two will be shut down for him in a year or two if he does not pay. I believe he should file the returns for all three to avoid having FTF penalties added to the debt he may or may not be able to pay at some point. Am I right? He has been a long time client through some very good years where he paid me handsomely and he was a friend before he became a client so I am willing to provide my services for free while he is broke.

[BOB W]

Must file Federal forms($87.50 ??? a month penalty) and State for whatever your State charges for late/non filer.

[erchess]

TY Bob

That's what I thought. I can't see any reason to do so but if I wanted, could I dodge the penalty by filing a timely extension? I realize the state would charge ftp penalty and interest on what was owed but it looks to me as though Federal only penalty would be ftf and an extension ought to prevent that.

[BOB W]

S Corp... no tax with extension.... States usually require payment with extension for annual filing fees...........

[erchess]

Tyvm

Many many thanks

[JohnH]

Why not terminate the S-corp election so you don't have to deal with the risk of that pesky $195 per month potential penalty in the future?