S Corp Election

Description

Some American companies may opt for the S Corp Election. Among the requirements, all shareholders must be U.S. citizens or residents.

Key Benefits of S Corp Election:

• Pass-Through Taxation: An S Corp allows company profits and losses to pass directly to shareholders without being taxed at the corporate level. This avoids the double taxation that occurs with a C Corporation, where profits are taxed at both the corporate level and again when distributed as dividends to shareholders.
• Self-Employment Tax Savings: Shareholders who are employees of the company can receive a reasonable salary, with remaining profits distributed as dividends, which are generally not subject to self-employment tax.
• Limited Liability Protection: Like other corporations, an S Corp offers limited liability protection to its shareholders. This means shareholders’ personal assets are protected from the company’s debts and liabilities.
• Access to Tax Benefits: An S Corp may qualify for certain tax deductions not available to other business types, such as deductions for employee benefits (health plans, retirement plans, etc.).

You can rely on us to handle your S Corp Election smoothly.