XYZ Was Formed as a Calendar-Year S Corporation with Xavier,Yolinda,and

question 98

Short Answer

XYZ was formed as a calendar-year S corporation with Xavier,Yolinda,and Zach as equal shareholders.On September 15,2017,XYZ's S election was terminated after Zach sold his XYZ shares (one-third of all shares)to his solely owned C Corporation Zach,Inc.Absent permission from the IRS,what is the earliest date XYZ may again elect to be taxed as an S corporation?

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Definitions:

Variable Overhead

Costs that fluctuate with production volume, such as utilities or materials used in the manufacturing process.

Overhead Efficiency

The effectiveness with which an organization manages its overhead costs in relation to its operational activities.

Direct Labor-Hours

Cumulative working hours of employees specifically involved in the production process.

Variable Overhead

Costs that vary with the level of production or business activity, such as utilities or raw materials.