We have previously looked at the recognition period for built-in gains of S corporations, and the effect of the expiration of the temporary reduction of this period, under the American Taxpayer Relief Act of 2012, to five years. Earlier this week, however, the 
House Ways and Means Committee approved six “tax extender” bills to extend certain tax provisions that expired at the end of 2013. Among these bills was H.R. 4453, which would make the five-year recognition period permanent. As we have discussed, electing S corporation status is still a smart option for C corporations in several scenarios to consider, and, if this bill is ultimately passed, it will make such an election even more attractive. Stay tuned for updates as this bill and the companion Senate bill, S. 1855, wind their way through the legislative process.
