An S corp is an organization that has chosen to pass its tax burden to its shareholders, rather than report income, losses, deductions and credits directly to the Internal Revenue Service (IRS).

Ultimately, the right entity choice depends on the business’s goals, profit model, ownership structure, and tolerance for ...

For many reasons, the limited liability company (LLC) established itself as the preferred legal entity type for small businesses. Many find that the benefits of an LLC can be extended further if an ...

When you’re setting up a business, choosing the right corporation type can feel like a big deal. It’s not just about the name; it’s about how your business will be taxed, how you’ll handle ...

An S corp and C corp share a number of similarities. They are both types of corporations recognized by the IRS. They can also both raise funds by issuing stock to shareholders. However, S corps are ...

Many banks have elected to be “S Corporations” for tax purposes. This status can provide significant tax benefits to the bank’s shareholders, but it also comes with several ongoing technical ...

The IRC permits certain qualified retirement plan trusts to be shareholders of S corporations; thus, an S corporation can adopt an ESOP. 1 When a tax-exempt entity (e.g., an ESOP) holds an ownership ...

As clients' businesses evolve, it sometimes makes sense for them to change how their companies are taxed. And I expect that occasionally you've encountered clients who made a change at one point but ...

There are three main options: salary, distributions or both. The best choice depends partly on your role in the S-corp. Many, or all, of the products featured on this page are from our advertising ...

Jessica Gibson is a content update editor and writer for Investopedia. She has over 10 years of experience in digital publishing and three years of experience covering financial topics like insurance, ...