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Copyright 2006, All Rights Reserved
Copyright 2006, All Rights Reserved
“ Mr. Montgomery made our S corp process easy and painless. Having very little knowledge of the legal end, he made it easy to understand . We really appreciate his dedication to small business.”
Wendy Evans - Business Owner
Wendy Evans - Business Owner
Why Use Us
What You Get
What It Costs
Questions & Answers
How to Get Started
Liability Protection
Contact Us
Our Guarantee
Other Services
What You Get
What It Costs
Questions & Answers
How to Get Started
Liability Protection
Contact Us
Our Guarantee
Other Services
S Corporations
Attorney Robert Montgomery
One of the Best Choices
for Small Business Owners
Many attorneys and accountants recommend forming an S corporation for small business owners who provide a service or sell a product. An S corporation provides limited liability protection for personal assets and provides similar tax benefits to operating as a sole proprietor or partnership. In addition, operating as an S corporation may enable you to save considerable money on the FICA or self employment taxes.
An S corporation is initially formed just like a regular C corporation based upon the requirements of the state in which it is formed. Then the shareholders elect a different tax status by filing the S election form with the IRS. The same liability protection applies, regardless of whether the corporation is a C corporation or an S corporation. The only real difference is in the tax treatment of income generated by the business.
A regular or C corporation is a taxable entity and must pay income tax on its net income. S corporations are not taxable entities but are treated similar to partnerships. That means that the net income of the business passes through to the individual shareholders based upon their percentage of share ownership. The shareholders must declare their share of income from the S corporation on their individual tax returns. The S corporation itself files an informational return much like a partnership.
S corporation election is made by filling out and filing form 2553 with the IRS. The tax law affords you 75 days after incorporation or 75 days from the start of each new calendar year to file for S election status. If approved, your business will then be subject to the tax laws most like a partnership rather than a regular C corporation. Since each situation is unique, you should first consult with your accountant or tax adviser before making the election.
S corporation election may enable you to save considerable money on the FICA or employment taxes (the 15.3% of social security and medicare taxes) and avoids double taxation of profits as sometimes occurs in a regular C corporation.
The operation of an S corporation is the same as a regular C corporation and is governed by the same corporate laws in the state of incorporation.
To help you decide if an S corporation is best for
your business, please feel free to call us toll free
at 1-888-527-6207.
for Small Business Owners
Many attorneys and accountants recommend forming an S corporation for small business owners who provide a service or sell a product. An S corporation provides limited liability protection for personal assets and provides similar tax benefits to operating as a sole proprietor or partnership. In addition, operating as an S corporation may enable you to save considerable money on the FICA or self employment taxes.
An S corporation is initially formed just like a regular C corporation based upon the requirements of the state in which it is formed. Then the shareholders elect a different tax status by filing the S election form with the IRS. The same liability protection applies, regardless of whether the corporation is a C corporation or an S corporation. The only real difference is in the tax treatment of income generated by the business.
A regular or C corporation is a taxable entity and must pay income tax on its net income. S corporations are not taxable entities but are treated similar to partnerships. That means that the net income of the business passes through to the individual shareholders based upon their percentage of share ownership. The shareholders must declare their share of income from the S corporation on their individual tax returns. The S corporation itself files an informational return much like a partnership.
S corporation election is made by filling out and filing form 2553 with the IRS. The tax law affords you 75 days after incorporation or 75 days from the start of each new calendar year to file for S election status. If approved, your business will then be subject to the tax laws most like a partnership rather than a regular C corporation. Since each situation is unique, you should first consult with your accountant or tax adviser before making the election.
S corporation election may enable you to save considerable money on the FICA or employment taxes (the 15.3% of social security and medicare taxes) and avoids double taxation of profits as sometimes occurs in a regular C corporation.
The operation of an S corporation is the same as a regular C corporation and is governed by the same corporate laws in the state of incorporation.
To help you decide if an S corporation is best for
your business, please feel free to call us toll free
at 1-888-527-6207.
Attorney Robert Montgomery has been counseling and incorporating businesses for more than 20 years. During that time, he's helped set up more than a 1000 corporations and limited liability companies (LLC's). He's a former business owner himself and has been corporate legal counsel for numerous small business corporations. He's presented lectures and seminars on the benefits and procedures involved with incorporating or forming LLC's and how to operate them for maximum benefit. He is a respected member of the legal community and is licensed to practice law in three states. References will gladly be provided upon request.
