I forgot to file my S corporation election with the IRS last year. What now?

Don’t panic. While it is always preferable to get an S corporation election filed on time, the IRS has instituted a relatively painless procedure for granting relief for a late S corporation election, so long as the late election would otherwise be valid, and it is made within 3 years and 75 days of the effective date of the election. In that event, the entity seeking relief can file the standard election on Form 2553 (with a statement at the top that it is being filed pursuant to Revenue Procedure 2013-30), together with a statement indicating what “reasonable cause” the entity had for failing to make a timely election. Thankfully, reasonable cause is a low bar. In one instance, the IRS ruled that it would accept an S corporation election that was filed late simply because the employee who was supposed to mail in the election did not actually mail it. For more information, see our article on why a Tardy S Election Is No Reason to Freak Out.