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Startup Business-S-Corp

s-corp

Background.

S-Corp is an unfortunate name for a type of income tax filing status with the IRS. It refers to the way the business is treated for federal income tax purposes and has nothing to do with being a corporation. In fact either a corporation or an LLC may become an “S-Corp” merely by filing the appropriate election form with the IRS on a timely basis. The benefits of S-Corp election include:

  • Avoids double taxation on dividends of a Corporation
  • Permits an LLC to retain earnings without having to pay self employment tax on the portion that is retained
  • Allows the owner of a single-member LLC to receive W-2 earnings, which can be helpful for personal credit

However, there are restrictions on the number and residency status of owners, and on having different classes of ownership—which can be a key reason the LLC form is used in the first place.

The Argent Place Solution

  • Work with you and your accountant to help you decide whether S-Corp status is right for your situation
  • Optionally file the S-Corp Election for you

Expected Results:

  • Careful consideration of the election options to best fit your individual and the company’s needs

 

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