What Is An S Corporation?

An S Corporation is a limited liability company in the United States of America. The reason for its name is that it is taxed under S section of chapter one of the Internal Revenue Code. The uniqueness of this company is that they do not pay any taxes on the profits they make in a financial year. The shareholders pay the income tax when they purchase shares of the company. The taxation procedure is also easier than the C Corporation. A C Corporation is an opposite of a S Corporation. In order to form an S Corporation, it is important to fill a 2553 form by the shareholders of that company.

It is a small business that has gone corporate.