What is an S Corporation?
If you are thinking of starting a small business, it pays to look at the big picture. A small business will always grow into a larger business or company in the future and that is when most entrepreneurs realize that their tax rate has also become higher. The bigger your company – the higher the tax rate!
This is not all, you may even come face to face with tax season complexities, but the good news is that there is a bright side to it all. You can consider opting for an S Corporation!
S corps are business entities that have elected to pass their corporate income, loss, deduction, and credits through to the business shareholders for the purpose of federal taxation. As a result, the shareholders of an S Corporation will have to report their income or loss on the individual income tax returns.