Five States Require S Corporations to Jump Through Additional Hoops

Although forty-five states accept a Federal S Corporation election if the corporation has filed a valid IRS Form 2553, a handful of states do not.  In Arkansas, New Jersey, New York, Ohio, and Wisconsin(sometimes), a separate state election must be made.

The following is a summary of the states that require compliance with additional filing requirements:

Arkansas:  To be recognized as an Arkansas S-Corporation, an Arkansas Election by Small Business Form (AR1103) must be filed with the State of Arkansas Department of Finance and Administration.  See, State of Arkansas: Election By Small Business Corporation

New Jersey:  To be recognized as a New Jersey S-Corporation, a New Jersey S Corporation Election From CBT-2553 must be filed with the State of New Jersey Division of Revenue.  See, New Jersey S Corporation

New York:  To be recognized as a New York S corporation (Tax Law section 660(a)) by filing Form CT-6 with the NYS Tax Department, See, New York S Corporation

Ohio:  Ohio Revised Code section 5733.09(B) requires that an S corporation file a notice of the S election with the Ohio Tax Commissioner between the first day of January and the thirty-first day of March every year for which the election is in effect.  The form is the Ohio Tax Department Form FT 1120-S, Notice of S Corporation Status.  See, Ohio: Notice of S Corporation Status

Wisconsin (sometimes):  A corporation that is an S corporation for federal income tax purposes uses From 5E to elect not to be a tax-option corporation for Wisconsin tax purposes.  See, Wisconsin: S Corporation Not to Be Treated as a Tax-Option Corporation