Dissolving Partnership & Converting to S-corp

[Seidy Lasker]

If a partner in a partnership wanted out, would the partnership file a final year return and then convert the LLC to an S-corp or would filing a final year return cause the ein to terminate and the partnership would need a new ein?

Thanks

[Christian Block]

Agree with the above, you would first want to look at the partnership agreement. If it is a two member partnership, and one partner assumes all of the ownership, the LLC would continue to operate a disregarded entity. If the LLC owner is an eligible S Corporation shareholder, then yes, you can probably make an election to be taxed as an S Corporation.

Partnerships are complicated, and you would want to seek advice from a CPA well versed in partnership taxation.  And since this is a real estate forum, you should be cautious and know the ramifications of contributing real property to a corporation.