Avoid double taxation when dissolving a corporation?

so my C-Corporation had a income of 23K, after expenses it had 22K in profits for 2007. I paid taxes on 22K in the corp's 2007 tax return.





Now i moved from MA to TX and want to dissolve the MA corp and open a new TX Corp. why you ask, because even if you don't have any profit you still have to pay MA 400 bucks.





But, back to what we were talking about. So i suppose closing that corp will require me to pay my self that 22K as i am the sole share holder. and doing so will add 22K to my income hence i will have to pay tax on that 22K.





Now is this not double taxation. how can i avoid this double taxation.


Thanks

Avoid double taxation when dissolving a corporation?
Did no one ever tell you that the problem with C-corps is double taxation? THis is true ANY TIME you distribute Corp profits to shareholders, whether as a dividend or upon dissolution of the corp. This is why COngress passed subchapter S of the IRC, to allow certain small businesses to elect to bypass the double taxation.





The way around it is to retroactively apply to be an S-corp. See the instructions for IRS form 2553. The election would have been automatic had you filed the form timely, but it isstill available to you.





Also, see IRS "Rev. Proc 2003-43" which tells how to retroactively make the S-election.





Good Luck.
Reply:You may not need to worry. You are a sole proprietorship. In 95, I applied for an EIN as a corp. They said I was a sole proprietorship. Check your approval paper fromthe IRS when you first applied for the EIN. I do not think IRS policy has changed. Report It

Reply:Well, unfortuneatly, when closing a C Corp, it is next to impossible to not pay double taxes based on the facts your present. Do you have any prior year NOLs that you could take advantage of?
Reply:Do you have any basis in the corporation?





But my real question is don't you have someone who helps you with your books and taxes?