Many people think the “s” in S Corporation means small, but it stands for Subchapter S in the Internal Revenue Code. This type of business is limited to less than one hundred shareholders and offers protection fromliabilitiesfor them. The income generated by the corporation goes directly to ...
Subject to approval and removal of status by the IRS.On rare occasions, the IRS may terminate an S corp’s Subchapter S status if an S corp either doesn’t properly allocate profits and losses or makes any other noncompliance moves, such as mistakes in an election, consent, notification, ...
3. S corporation:An LLC can choose to pay taxes as an S corporation (also called an S subchapter) tax classification by submitting theIRS Form 2553.Here, profits aren’t subject to corporate income tax. Instead, LLC owners pay tax on their share of company profits, which aren’t subject ...