Trap 8 · The 2553 deadline · From Chapter 9
The 2553 Deadline: 2 Months 15 Days
Form 2553 is due within 2 months and 15 days of the tax year’s start for the election to take effect that year — March 15 for a calendar-year company. File late and the election waits until next year, unless late relief saves it.
The timing rule
Section 1362(b) gives the election current-year effect only when Form 2553 is filed within the first 2 months and 15 days of the tax year — March 15 for a calendar-year company. File one day later and the election sleeps until the following year.
Effective-year mechanics
The election names its effective date, and every person who holds stock during the run-up must consent — a missing signature voids the filing. New companies elect from formation on the same clock, measured from the short first year, and must already satisfy the eligibility rules: see S Election Eligibility.
Missed it?
A late election is often fixable rather than fatal — but the fix has its own rules, statements, and clock. Late relief lives on the Trap 5 page: Late S Election Relief.
Trap questions, answered
- When is Form 2553 due?
- Within 2 months and 15 days of the start of the tax year it should take effect — March 15 for calendar-year companies.
- What happens if I file late?
- The election takes effect the following tax year instead — unless late-election relief backdates it. See the late-relief trap page.
- Can a brand-new company elect mid-year?
- Yes — a new company can elect S status from formation if Form 2553 is timely for its short first year and every shareholder consents.
The law: 26 U.S.C. § 1362 · Chapter 9
From the practice: Election timing needs a practitioner
The other traps: Late S Election Relief · S Election Eligibility · Reasonable Compensation · Distributions vs Salary