S-Corporation is a business entity allowing you to protect your assets, avoiding the two-tier taxation on both corporate and personal level. S-Corporations works like any other ordinary business, nonetheless, for federal purposes, they elect to pass deductions, income, profits and losses through their shareholders.
If integrating your business looks complicated, we will assist you through the process so that your business flows smoothly like never before.
Wondering about the benefits that you would receive if you choose a S-Corporation?
How IRS defines an S-Corp:
An S-corporation can be simply explained as a for-profit corporation. Electing them to be taxed under Internal Revenue Code’s Subchapter S, allow them to turn into a ‘pass-through’ entity. Though it is incorporated and governed by the same state corporation laws like a corporation, they still have the ability to avoid double-taxation. Double taxation means that the businesses have to pay income tax twice – once to the shareholders, and then to the corporation, for the same source of income.
Under an S-Corporation, all the profits and losses are passed directly to the shareholders. Thus, the shareholders will have to file separate individual tax returns and pay income tax for just their part of the income.
How an S-Corporation differs from a C-Corporation?
The only factor that separates a C-Corporation from S-corporation is that unlike an S-Corporation, C-Corporation is taxed under Internal Revenue Code’s Subchapter C whereas, S-Corporation comes under Subchapter S. Alongside, S-Corporation cannot have over 100 shareholders.
REQUIREMENTS To become an S-corporation & TAXATION
An S-Corporation is exempt from federal income tax. Instead, the shareholders have to pay the tax based on the share of income allocated to them. Form 1120S is used by an S-Corporation for the annual tax return. The most important fact about S-Corporation is that the shareholders don’t necessarily have to pay self-employment tax on their share of the entities profit.
In order to pass as an S-Corporation, entities have to fulfil the below listed criteria’s:
In order to become an S-Corporation, the entities will have to submit form 2553.
GET AN EIN FOR YOUR S-CORPORATION
We make it easier for you to obtain an EIN/ Tax ID Number for your S-Corporation. While you would be left to enjoy your leisure time with your near and dear one, we put our people at work. And we fill up the S-Corp tax ID application and the EIN application form and submit it online on behalf of you.
We understand that time is of the essence. While you dream of a bright and successful future, we get the paperwork done and fasten the pace of getting your job done. Get in touch with at the earliest to get your work on our schedule.