Business Taxes and Filing Status Changes
Understanding Tax Obligations
Your Growing Business
As your business grows, a qualified tax professional is probably one of your most valuable advisors. They can help you assess your current situation, and help you project potential changes in your tax filing status as your business grows.
Changing your federal tax filing status with the IRS often requires no change in business entity type or your registration with Secretary of State. They are separate, and the Corporation Division cannot provide any tax advice.
Tax Filing Status
We can say that one of advantages of a Limited Liability Company (LLC), as a business entity type, is the options available for tax filing status with the IRS. Once established, an LLC’s change in tax filing status from “sole proprietor” to “partnership” with the IRS is just a simple (free) update to the LLC registry to show more than one owner. Likewise, an “S Corporation” is a tax filing status with some tax advantages as a business grows, but an LLC can elect “S-Corp” tax filing status without any change in the business registry with Secretary of State. Ask your accountant or tax advisor, or go to the IRS page “Do you need a new EIN?” for more information.