Ngcarper Posted February 24, 2021 Report Share Posted February 24, 2021 I have client who has bizarre situation: 1) Filed 1120S for 2017 late, assessed late-filing penalty, now in process of being abated. 2) Has yet to file for 2018 or 19. All income was deposited into her personal bank account from “Square”—but they reported using her 1120S #. Client would like to file an amended 2017 to finalize the S-Status and report all subsequent income on a Sch C. Square is being rather jerking and does not want to amend their 1099s to her SSN (even showing this is where the funds were deposited to). Two Questions: 1) Can we file an amended 2017 1120S to make it finalized (obviously before the closing window); 2) Pick up the subsequent income on her Sch C even tho Square issued 1099s to her 1120S. This is particularly important because she has NOT filed those 1120S for years 18 or 19. It’s a mess and an IRS Roulette Game I think....any suggestions and advice? Thanks in Advance. Quote Link to comment Share on other sites More sharing options...
Lee B Posted February 24, 2021 Report Share Posted February 24, 2021 Key Question: How was the Square account set up, under the Corporate Name or personal name or ? What was the reason for requesting abatement? Quote Link to comment Share on other sites More sharing options...
Ngcarper Posted February 25, 2021 Author Report Share Posted February 25, 2021 Square was set up with 1120’s EIN but deposited into TP’s Sch C account. Have asked them to amend their 1099 for yrs 18 & 19 but they are refusing. Requested abatement because of great difficulty in getting tax records from prior CPA. Quote Link to comment Share on other sites More sharing options...
Abby Normal Posted February 25, 2021 Report Share Posted February 25, 2021 If just the bank account was wrong, you just debit distributions and credit sales. But was she paying S corp expenses out of the S corp checking account? If so, where was the money coming from to pay expenses? Other sources of sales (cash, cc)? Was she transferring the square deposits to the S corp checking account? And why did she not correct as soon as it started happening? Sounds like she was nowhere near ready to go the S corp route. 2 Quote Link to comment Share on other sites More sharing options...
grandmabee Posted February 26, 2021 Report Share Posted February 26, 2021 Plus how can you close out an S-Corp when you still have a business checking account and paying bills. Or maybe I was assuming they were. Did they renewal their S-corp status with their State each year? Quote Link to comment Share on other sites More sharing options...
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