Last year, I made the questionable decision to create several C-corps while drunk, just so I could call myself the CEO and CFO of multiple companies. Now I owe $3,000 in Delaware franchise taxes.
None of these companies actually did any business. So, do I need to pay anything federally? Should I just file a bunch of 1120 forms with zero income, or is there more to it?
Kaius said:
I don’t know much about Delaware tax laws, but this story is gold.
I’m not trying to avoid my responsibilities. I’ve already set up payments for the $3,000. But for federal taxes, can I handle this myself with 1120 forms, or do I need to involve my CPA? It’s honestly pretty embarrassing.
@Blake
Did you get EINs for these companies? Also, did you elect to make them S-corps (1120S)? That’s a lot of work to do while drunk—you might have missed your calling as a tax pro!
Zeke said: @Blake
Did you get EINs for these companies? Also, did you elect to make them S-corps (1120S)? That’s a lot of work to do while drunk—you might have missed your calling as a tax pro!
Is an EIN the same as an FEIN? I have those numbers for each corporation. I just want to clean up this mess without looking too dumb in front of my CPA.
@Blake
Yep, EIN and FEIN are the same. The IRS will expect an 1120 form for each. Maybe you could combine them as subsidiaries of one main corporation and file just one return.
Zeke said: @Blake
Yep, EIN and FEIN are the same. The IRS will expect an 1120 form for each. Maybe you could combine them as subsidiaries of one main corporation and file just one return.
Thanks for the tip. I’ll ask my CPA about it. Lesson learned—don’t drink and start businesses.
Delaware’s tax depends on your stock structure. Look into their Assumed Par Value Capital Method—it might reduce your costs to $400–450 per corporation.