S-corp Question

[POCAHONTAS]

Thanks to all for info for the previous question. My next question is:-
the taxpayer formed the S-Corp in Utah but is now resident of California. So he files the corporation return for the State of Utah, but does he have to register as an S-Corp with California also? Thanks

[S T]

calif

If the Scorp is doing business in California and deriving income from Calif, then yes the Scorp needs to register the Corp with the Secretary of State in California and file the appropriate S Corp tax returns.

I have an S Corp that does business in 8 different states, so have to prepare the "apportionment" returns in each state. What a Pain! Registered in Nevada! but 80% of the operations are in California.

If the shareholder is a resident of California, but the S corp is NOT doing in business in California, then the S Corp does not have to register or file, but the shareholder will have to report his W-2 and distributive share income to California as a resident and then also report to Utah as a non resident, or whatever other state as a non-resident. there is an "other state income tax credit" so that the t/p is not paying duplicate State Income Tax.

Gets a little complicated!

Sandy

[Snaggletooth]

Operation

Indian princess, there are several board members who are from California and can fill you in on California requirements, so I will defer to them.

However, the critical question is "Where does the corporation operate?" This is more important than where the shareholders live. The corporation will have to file a return in every state in which they operate.

Also, the corporation will have to file in the state of their incorporation even if they don't operate there. For example, if it was incorporate in Utah but no longer operates in Utah, they will still have to file in Utah. The corporation is considered a "foreign" corporation to every other state except their state of incorporation, even if they don't operate there.

[POCAHONTAS]

S-corp Question

the corporation is a long haul truck driver so he has to go to different states therefore does that mean you still have to file the apportionment in every state he drives to?????

[S T]

Link

Here is a link to the Secretary of State for California http://www.sos.ca.gov/business/corp/....htm#question8

Sandy

[Snaggletooth]

Not for a Truck

the corporation is a long haul truck driver so he has to go to different states therefore does that mean you still have to file the apportionment in every state he drives to?????

A truck is not considered enough of a presence just driving through various states to require a return. Without knowing any more, I believe you must file an 1120S, and also a California and Utah return. California, because that is his home and central to his truck operation. Utah, because his company was incorporated there.

[Davc]

A truck is not considered enough of a presence just driving through various states to require a return. Without knowing any more, I believe you must file an 1120S, and also a California and Utah return. California, because that is his home and central to his truck operation. Utah, because his company was incorporated there.

Not unnecessarily. For a trucking operation, driving through the state is doing business in that state for most states. Many states have a de minimus exception if few enough miles are driven, but each state should be checked. And remember, the Amtrak Law does not apply to Corps.