A client wanted to turn invoke an S-Corporation election for tax reasons. The only problem was that he was about two months too late for the current fiscal year. Ten years ago, that would have been a large problem, but with the IRS’s new positions, that problem is not so big. Recent regulations have been issued that allows shareholders relief in late elections.
But, if you want to elect an S-Corporation, make sure that you have looked at all aspects like personal tax benefits, you tax basis for taking losses, medical costs deductions, etc. Most business persons only look at the first benefit and disregard the rest. If you are into the minutia, here is an interesting, but technical article from the AICPA.
Above all, if you elect to be an S-Corporation, play by the rules. I wrote a blog on this not too long ago. Take a look at it for some advice, but always consult a tax advisor regarding your particular situation.