An S corporation (S corp) is a type of corporation designed to avoid the double taxation that regular corporations or C corporations (C corps) pay. Tax authorities typically treat anincorporatedbusiness as a C
What Is an S Corp? An S corp (or S corporation) is a business structure that is permitted under the tax code to pass its taxable income, credits, deductions, and losses directly to its shareholders. That gives the S corp certain advantages over the more common C corp. The S corp is ...
An S corporation is an optimal classification for small businesses that have low startup costs and are looking to remain small. Here's what else you need to know.
Fill out and submit Form 2553, Election by a Small Business Corporation, to the IRS to establish S-corp tax status. If your business is an LLC that chooses to be taxed like an S-corp, you must file Form 1120-S with the IRS. 6 Differences Between a C-Corporation and an S-...
whereas an inactive nonprofit corporation is required to file such a report each year. New Mexico charges a penalty for a late report, which is $200 at the time of publication. Kentucky, however, requires a report from all registered corporations by the last day of June every year. If a...
A C Corporation is one of several ways to legally recognize a business for tax, regulatory and official reasons. See if starting a C Corp is right for you.
What is an S-Corporation? An S-Corporation is a corporation that elects to be treated as a "pass-through" entity for tax purposes. In other words, the income and expenses of an S-Corporation are passed through to its shareholders to determine their income tax liability. This means that ...
Making the S corporation (S corp) election To become an S corporation, you must file Form 2553 with the IRS. The IRS instructions—which can be a bit tough to follow—require that an election is considered effective in the current tax year only if the Form 2553 is completed and filed: ...
An LLC (limited liability company) provides more flexibility than a corporation, and more robust liability protection than a sole proprietorship.
So, when you hear someone talking about an S Corporation, understand that it is not a business entity in its own right; it is simply a C Corporation or an LLC that the IRS has granted a particular tax status. It gets its name from the Subchapter S tax code under which it’s governed...