S-Corporation Formation Services

Have you heard the latest benefits of forming an S-Corporation, but you're still confused on if it is the next best step for your business?

Have you tried to determine your reasonable salary compensation and completed the required IRS form, but find yourself stressed out?

Don't be intimidated about forming an S-Corporation, and don't allow the misinformation from colleagues, friends, and family to prevent you transforming your organization.  We'll help remove the stress and uncertainty of forming an S- Corporation and provide you with everything you need to remain in compliance with all Federal and State agencies. 

What is an S-Corporation?

S-corporation stands for "Subchapter S-corporation."   An S-Corporation is a business that elects to pass the corporate income, losses, deductions, and credits to their shareholders. 

Advantages Of An S-Corporation

• An S-Corporation's main advantage is that it's only taxed once according to section S of the Internal Revenue Code; therefore the S-Corporation does not pay federal income taxes. 
• The corporation "elects" to pass on its income, losses, deductions, and credits to its shareholders for tax purposes. This pass-through taxation allows the corporation to avoid paying double taxes on income.
• As an S-Corporation, your company can attract investors by offering shares of stock in exchange for capital to fund continuous growth. 
• The business can continue to operate even after the owners depart.
• If you ever decide to sell your business, you'll pay a lot less in taxes when selling an S-Corporation than selling a C-Corporation.
• S-Corporation provides personal liability and asset protection that prevents the officers, directors, and shareholders from being held responsible for its debts.

Disadvantages of An S-Corporation

• Because the S-Corporation status allows for distributions to a shareholder, the IRS scrutinizes payments to make sure the characterization conforms to reality.
• The IRS can revoke the S-Corporation status and assess back taxes for 3 years and impose a further 5-year waiting period to regain the tax status, if the company doesn't adhere to the tax rules and compensation requirement.
• The IRS keeps a close eye on whether the officers are paying themselves a "reasonable" salary.
• S-Corporations are not treated equally by each state government. 

How An S-Corporation Will Help You Save Taxes?

Use the example below to understand the tax-saving benefits of becoming an S-Corporation.

Michele is the owner of Elite Consulting firm.  Last year Michele earned $750,000 in Gross Revenue that resulted in $250,000 remaining in Net Profit.  ($750,000 Gross Revenue - $500,000 Annual Expenses = $250,000 Net Profit).