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S Corporations

S corporations are corporations that elect to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes. Shareholders of S corporations report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates. This allows S corporations to avoid double taxation on the corporate income. S corporations are responsible for tax on certain built-in gains and passive income at the entity level.

To qualify for S corporation status, the corporation must meet the following requirements:

  • Be a domestic corporation
  • Have only allowable shareholders
    • including individuals, certain trusts, and estates and
    • may not include partnerships, corporations or non-resident alien shareholders
  • Have no more than 100 shareholders
  • Have only one class of stock
  • Not be an ineligible corporation (i.e. certain financial institutions, insurance companies, and domestic international sales corporations).

In order to become an S corporation, the corporation must submit Form 2553 Election by a Small Business Corporation (PDF) signed by all the shareholders. See the instructions for Form 2553 for all required information and to determine where to file the form.

Filing Requirements:

Chart 1 - S Corporation
If you are an S corporation then you may be liable for... Use Form... Separate Instructions...
Income Tax 1120S (PDF)
1120S Sch. K-1 (PDF)
Instructions for Form 1120S (PDF)
Instructions for Form 1120S Sch. K-1 (PDF)
Estimated tax 1120-W (PDF) (corporation only) and 8109 Instructions for Form 1120-W (PDF)

Employment taxes:

  • Social security and Medicare taxes and income tax withholding
  • Federal unemployment (FUTA) tax
  • Depositing employment taxes

 

941 (PDF) ( 943 (PDF) for farm employees)

940 (PDF)
8109

Instructions for Form 941 Employers QUARTERLY Federal Tax Return (PDF)

Instructions for Form 943 Employers Annual Federal Tax Return for Agricultural Employees (PDF)

Instructions for Form 940 Employers Annual Federal Unemployment (FUTA) Tax Return (PDF)

Excise Taxes Refer to the Excise Tax web page  

 

Chart 2 - S Corporation Shareholders
If you are an S corporation
shareholder then you may be liable for...
Use Form... Separate Instructions...
Income Tax 1040 and Schedule E (PDF) and other forms referenced on the shareholder's Schedule K-1 Instructions for Schedule E (Form 1040)Supplemental Income and Loss (PDF)
Estimated tax 1040-ES (PDF)  

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Page Last Reviewed or Updated: 19-Nov-2013