Becoming an S corporation for United States federal income tax purposes can be a very enticing thing to do.<\/p>\n
S corporations are unique in that they don\u2019t pay federal income taxes. The incomes and losses are divided among the corporation\u2019s individual shareholders instead. Unlike C corporations, S corporations are not double-taxed through the company\u2019s profits and shareholder dividends, which is perhaps the most important part of S corporation status. Predictably, this can result in substantial income savings.<\/p>\n
There are a variety of other benefits a corporation can gain from electing to be treated as an S corporation, including the ability to offset losses against taxable income from other sources. Also, some corporate penalties and the federal alternative minimum tax do not come into play for an S corporation.<\/p>\n
It is important to note that while S corporations have many advantages, there are other operational matters that should be considered. Firstly, there are other costs (more…)<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Becoming an S corporation for United States federal income tax purposes can be a very enticing thing to do. S corporations are unique in that they don\u2019t pay federal income taxes. The incomes and losses are divided among the corporation\u2019s…<\/span><\/p>\n