TaxGuyBill
Level 15

Did they make the late election, and the 8832 was attached to the first year?

If so, that election allows it to be e-filed even though the IRS computers don't recognize it as a S-corporation.

In the following year, the rejection likely means the IRS computers don't recognize it as a S-corporation.  Have they received the acceptance letter that it is a S-corporation?