S Corp Election Validity: Common Oversight in LLC Operating Agreements 2026

The clause that could cost your client 

A limited liability company (LLC) operating agreement can put a client’s S corporation (S corp) election at risk. Partnership-style distribution provisions may seem routine, but they can conflict with the requirements for maintaining S corporation status. 

S Corp Election Validity: Common Oversight in LLC Operating Agreements puts you in the position of identifying those risks before they become costly. Examine how non-identical governing provisions and election errors can invalidate or terminate an election, potential tax consequences, and available remedies under current IRS guidance.  

You’ll cover: 

• Drafting and reviewing governing documents and coordinating legal and tax advice  
• Establishing and maintaining a valid S corporation election, including the one class of stock rule and common compliance pitfalls  
• Governing provisions and distribution clauses in LLC operating agreements that can invalidate or terminate an election, and the resulting tax consequences  

Help your clients preserve S corporation status while avoiding common compliance pitfalls and costly tax consequences with guidance from S Corp Election Validity: Common Oversight in LLC Operating Agreements.