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S Corp Election

Elect S Corp Tax Status For Your Business

Save time, money, and hassle when you use our professional document filing services to help elect your s-corp status.

The Benefits of An S-Corp Election:

  • Limited Liability Protection
  • Raise Money By Selling Shares
  • Gain Credibility
Elect S-Corp Status for an Existing Business

File An S-Corp Election

Starting at $39 + state fees

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How Does it Work?

Answer a few basic questions

We'll prepare your business filings

You'll receive your completed filings

Existing Corporation or LLC?

Elect S-Corp status to change how an existing corporation or LLC is federally taxed.


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Help Me Choose

Not sure which entity is best for you? Take our "help me choose " interview, or click here to see the details of the various options.

An S-Corp Election is a tax-related filing. Many people think that an S-Corporation is a type of corporation, but really, an S-Corporation is a C-Corporation with an S-Corporation tax election. When the S-Corp tax election is made, the entity is telling the federal government that it would like to be taxed as a partnership rather than as a corporation. This is often done to avoid taxation at the corporate level and then again when distributions are made (at the individual level).

When the entity is taxed as a partnership, the corporation's profits pass through the entity level and are taxed only at the shareholder level. There are specific requirements that must be met to qualify as an S-Corporation, so if this type of entity is of interest, you should make sure you qualify.

A large majority of our small business customers meet the following requirements:

  • Be filed as a U.S. corporation
  • Maintain only one class of stock
  • Maintain a maximum of 100 shareholders
  • Be comprised solely of shareholders who are individuals, estates or certain qualified trusts, who consent in writing to the S Corporation election
  • All shareholders must have a US Social Security Number
  • Corporate fiscal year ends December 31st

Failure to observe any of the above requirements could revoke your S Corporation status at any time. Whether or not an S Corporation is something that you would benefit from is a decision that only you can make. Please consult your lawyer or CPA for details.


File an S-Corp Election With MyCorporation Today Starting At Only $39

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How It Works

The business filing experts at MyCorporation can help save you time and eliminate the hassle of filing an S Corp election. We are here to support you during the filing process:

If you are adding an S-Corp Status to an Existing Business

  1. Fill out and submit the S Corporation Election order form on our website.
  2. You will find S Corp requests for standard contact, billing, and authorization information, plus specific requests regarding your entity, legal representative, and election information.
  3. We will complete the necessary documentation and forward it to you for your signature.
  4. You sign the documents and fax them to the IRS.

If you want to file a new business and add an S-Corp Status to it

  1. Fill out and submit the Start a Business Form
  2. Select that you want to add an S-Corp Election during the order
  3. Then, Give Us all the Additional Info and We Take Care of the Rest!

FAQ's

What is the deadline for selecting S Corporation status?

To qualify as an S Corporation in the present tax year, a "calendar year" corporation must timely file IRS Form 2553 with the IRS. If a corporation was in existence prior to the present tax year, then this filing must be submitted to the IRS on or before: March 15 of the present tax year. If the corporation is a "New Corporation", then the S Corporation election may be submitted at anytime during its tax year so long as the filing is made no later than 75 days after the corporation has began any of the following activities (whichever is earliest):

  • Conducted business as a corporation
  • Acquired assets, or
  • Issued stock to shareholders

When is the difference between an S Corporation and a C Corporation?

An S Corporation begins its existence the same way that a C Corporation (discussed above) begins its existence, as a general, for-profit corporation upon filing the Articles of Incorporation at the state level. However, after the corporation has been formed, it may elect S Corporation status by submitting IRS form 2553 to the Internal Revenue Service (in some cases a state filing is required as well). Once this filing is complete, the corporation is taxed like a partnership or sole proprietorship rather than as a separate entity. Thus, the income is "passed-through" to the shareholders for purposes of computing tax liability. Therefore, a shareholder's individual tax returns will report the income or loss generated by an S-corporation.

When should I qualify for S Corporation status?

To qualify as an S corporation, a corporation must timely file IRS Form 2553 with the IRS. This election must be made by March 15 of the current year if the corporation is a calendar-year taxpayer in order for the election to take effect for the current tax year. However, a "New" corporation may make the filing at anytime during its tax year so long as the filing is made no later than 75 days after the corporation has began conducting business as a corporation, acquired assets, or has issued stock to shareholders (whichever is earlier).

What factors are required for a corporation to qualify for S Corporation status?

The corporation must:

  1. Be filed as a U.S. corporation.
  2. Maintain only one class of stock.
  3. Maintain a maximum of 100 shareholders.
  4. Be comprised SOLELY of shareholders who are individuals, estates or certain qualified trusts, who consent in writing to the S Corporation election.
  5. NOT have a shareholder who is a non-resident alien.
  6. Failure to observe ANY of the above requirements could revoke S Corporation status at any time.

Who should elect S Corporation status?

Owners who want the limited liability of a corporation and the "pass-through" tax-treatment of a partnership will often make the S Corporation election. In most cases, corporations that would benefit from S Corporation status are those who plan on distributing the majority of earnings to its shareholders in the year those earnings are derived. Corporations who plan on retaining earnings for future investments in future tax years often choose the C Corporation because under the S Corporation, earnings will be taxed as if they were distributed to shareholders regardless of whether a distribution actually occurred or whether the corporation retained the earnings for future investment.

What are the S Corporation formalities?

An S Corporation follows the same state formalities as does a C corporation (i.e. filing Articles of Incorporation and paying state fees). However, an S Corporation must make a special tax election under sub-chapter S of the Internal Revenue Code by filing IRS Form 2553. In addition, certain states require that the corporation file an S Corporation Election at the state level as well.

What documents must I complete with the IRS?

The S Corporation must complete and file IRS Form 1120S to report its annual income to the IRS each year.

What are the general shareholder requirements?

ALL shareholders of the corporation must be U.S. Citizens or have U.S. Residency Status. If, for any reason, shares are somehow sold or transferred (even if by will, divorce, or other means) to a shareholder who is a foreign national, the corporation will lose its S Corporation status and be treated as a C Corporation.

Can I lose S Corporation status?

An S Corporation that loses its status as such may not re-elect S Corporation status for a minimum of five years.


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