As tax preparers, we are supposed to advise our clients of their best tax options and this is obvious to me that the tax preparer did not know what she was doing.  Does he report her?  Would that do anything FOR him or just awaken the sleeping giant he's concerned with.  Then does he simply dismantle the corporation and let it die a slow death, hoping IRS doesn't realize the errors in the filings?  Oh my.  I'm glad it's his issue and not mine...but he's asking for help.

Aloha no!