Need to file Fed/State Tax even though business is closed?

You should finish out 2008. If you filed a 941, I'm assuming you have employees. You have the final quarterly 941 for 2008 if you ended in Nov. Check your payroll set up, you should need to file 940 for year end. I don't know what else, you might have State issues, retirement contributions to send or other employee benefit issues to wrap up, W2 and 1099 need to be run.

Your question about your corporation is something to ask your CPA, it's not a QB issue.

Regardles if you are in business (open/still in process/closed) with zero activity you still need to file a tax return. Only when you dissolve your corporation - you file a return & mark it in the proper box final.

Good Luck,

Lordis Gawzner, EA

A2T Consulting, Inc.

Hi Psion,

As long as an entity is still on file at the state (i.e., you have not officially filed dissolution documents), the corporation remains an existing legal entity, and therefore annual compliance filings, fees and returns are still required -- even if no business is being conducted at all. Generally speaking, unless an owner has some other reason for keeping an inactive corp in legal existence (for example: plans on using the corporate entity for future business activity), then the only way to eliminate the entity's continuing annual obligatons is to file dissolution documents with the state.

If you do have some reason for leaving the corp in existence even though no business is being conducted by it, to my knowledge the s-corp status of the corp is not affected by the lack of business income.

Thank you all the responses -- I shall file my 2008 taxes.

Slaw888: "If you do have some reason for leaving the corp in existence even though no business is being conducted by it, to my knowledge the s-corp status of the corp is not affected by the lack of business income."

The only reason why I did not dissolve my corporation is -- the likelihood of my returning to being a consultant. The company I am currently working for, may not survive the current economic downturn.

Again, thanks to all!