Tax Guru – Ker$tetter Letter

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Convert S Corp to Non-Profit?

Posted by taxguru on May 27, 2007

Q:

Subject: Changing from an S-Corp

 

Hello,

 I just read you blog this morning and had a very interesting question for you. Have you heard of and is it possible to change from an S-Corp to a Non profit of 501(c) organization.  I am really curious about this type of change

Thank you for your time

A:

The short answer is NO. 

The types of entities involved are not compatible for such a switch.

A C or S corp is a legal being chartered by a state as a for profit entity.

To qualify as a non-profit organization, you need to have your state charter a non-profit corporation, which is completely different from a for-profit corp and involves different paperwork.

You should be working with a professional tax advisor to straighten things out for your particular goals.

Good luck.

Kerry Kerstetter

Follow-Up:

Thank you so much for your information.

 

 

 

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