The consent of all shareholders who have held stock during the pre-election portion of the taxable year is required in order for the election of S corporation status to be effective for that taxable year, even if the election is filed timely.

Question

Quizplus · Accepted Answer

This is correct according to IRC Section 1362(a)(2)(B). All shareholders who held stock during any portion of the taxable year prior to the effective date of the S corporation election must consent to the election, even if the election is filed timely.

The Consent of All Shareholders Who Have Held Stock During