What Form 2553 does
Form 2553 is how an eligible business formally elects to be taxed as an S-Corporation instead of its default tax treatment. It doesn’t create a new legal entity — it changes how an existing LLC or corporation is taxed by the IRS.

Who’s eligible to file it
To qualify for S-Corp election, a business generally must: be a domestic corporation or LLC, have no more than 100 shareholders, have only one class of stock, and have shareholders who are individuals, certain trusts, or estates (not other corporations or partnerships).

Timing matters a lot here
This is the form most likely to trip people up on deadlines. To have S-Corp treatment apply for the current tax year, Form 2553 generally must be filed within 2 months and 15 days of the start of that tax year. Miss that window, and the election typically doesn’t take effect until the following year; though late-election relief is sometimes available if there’s reasonable cause. If you have missed the window and want to see if there is any path to an exception, schedule a consultation with us and we will see if there is something we can do.

What happens after filing
Once approved, the business files Form 1120-S annually instead of a standard corporate or default LLC return, and profits pass through to shareholders via Schedule K-1.

How Luminary can help
Whether S-Corp status actually saves you money depends on your specific numbers; profit level, reasonable salary requirements, and payroll costs all factor in. We’ll run the numbers with you before you file, make sure you don’t miss the election deadline, and handle the S-Corp compliance once you’re in.