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CA S-corp was converted into to a NV S-corp through re-domestication. After the entity was converted into a NV entity, the CA entity dissolved. Date is 6/30/23.
Do I generate the returns as:
one client file for only filing the federal with the full year 1/1/23 - 12/31/23 and
a second client file for only filing CA with all the income/expense from 1/1/23 - 6/30/23, mark that CA return as dissolved
If I do this it strikes me as strange that the CA K-1 form has incorrect numbers in the federal column but it seems most accurate for reporting.
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Legally it is one corporation for 2023 so one tax return.
Mark the CA one final and apportion the total income to CA. I don't think you can allocate by cutting off the books.
The more I know the more I don’t know.
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This doesn't work because the business moved to NV and formally dissolved in CA. The entity existed as a CA domestic corp from 1/1-6/30 and the remainder of the year it was a NV corp not registered in CA and with no income in CA.
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You said it was redomesticated. That means it legally went from being a CA corp to a NV corp.
That's a 368(a)(1)(F) reorg.
The more I know the more I don’t know.
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Yes, that's correct. The CA one dissolved on 6/30. Maybe I am confused as to what you mean by
"Mark the CA one final and apportion the total income to CA. I don't think you can allocate by cutting off the books."
Not all the income is for CA, or did you mean apportion the income earned during the first six months to CA on Sch R?
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Yes use Schedule R to apportion to CA.
The more I know the more I don’t know.
