What is an S corporation (S corp)? An S corp is an IRS tax status (Subchapter S) for LLCs and corporations that offers income tax savings on distributions.
An S corporation is a variation of a corporation within Subchapter S of Chapter 1 of the Internal Revenue Code. To be an S corporation, your business needs to be set up as a corporation by filling and submitting documents like the Articles of Incorporation or Certificate of Incorporation to t...
S corp gets its name from Subchapter S of the Internal Revenue Code, under which it has elected to be taxed. Taxes The key characteristic of a corporation filed under Subchapter S: It may pass business income, losses, deductions, and credits directly to shareholders, without paying any federal...
An LLC requires much less paperwork to form and maintain than a Subchapter S corporation. Although the two are similar in many aspects, an LLC is considered to be more hassle-free. The profits and losses of the business can be allocated amongst the members in any way they choose. There is...
If you opt to register as a corporation, you’ll need to choose between C corporation vs. S corporation. Learn more about what all of this means below. S corporations explained The “S” in S corporation comes from IRS tax code, referring to subchapter S. An S corporation is a type ...
Defining S corporations An S corporation is a business entity that elects to pass taxable income, losses, deductions, and credits through to its shareholders' personal tax returns, making it different from a C corp in terms of taxation. By transferring all business income, losses, deductions, ...
So what’s the difference between the two? First, let’s reiterate that the S corporation is a choice that’s made for tax purposes. A corporation can elect to be taxed under Subchapter S of the Internal Revenue Code by filingIRS Form 2553with the IRS. When it does, it’s recognized ...
What is an S corporation? S corporation or S-corp is a company that has a unique tax designation that can be available to a particular company or LLC. The scope is named after the sub-chapter of the Internal Revenue Code (sub-chapter "S"), with its most distinctive feature - the so...
The definition of an S corporation is either a general corporation or a close corporation that has elected to be taxed pursuant to Subchapter S of the IRS code. To create an S-Corp you must first form one of the following: General Corporation: The most basic form of corporation, often ref...
S-Corporation:An S-corporation is a type of corporation that has elected to be taxed under Subchapter S of the Internal Revenue Code. Shareholders of an S-corporation have limited personal liability for the company’s debts. C-Corporation:A C-corporation is the most common form of corporation...