S Corporation

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S Corporation

A corporation that elects not to be taxed as a corporation. That is, the corporation does not directly pay federal income tax on its earnings. Similar to a partnership, it passes its income or losses and other tax items on to its shareholders.

S Corporation

A business with few shareholders that is exempt from some taxes levied on other corporations. Specifically, an S corporation is not responsible for taxes on its profits (corporate taxes) and is taxed as if it were a partnership. However, it may have no more than 100 shareholders. An S corporate structure allows a company to take advantage of some of the benefits of incorporation without all of the responsibilities attached to it.
References in periodicals archive ?
535) Black's Law Dictionary describes a Subchapter S corporation as a corporation whose income is taxed through its shareholders rather than through the corporation itself.
Speier amended the bill at the last minute to eliminate the denial of Subchapter S status and to simply impose a tax on Subchapter S Corporations higher than the 1 percent currently imposed, but the bill failed to meet the deadline.
These figures included companies that had zero earnings as well as Subchapter C and Subchapter S corporations.
Under the SBJPA, the law governing subchapter S corporations underwent numerous changes, one area of which will open up new estate planning opportunities for CPAs concerning the types of trusts allowed to hold S corporation stock.
63) See Joint Committee on Taxation, Law and Proposals Related To Subchapter S Corporations and Home Office Deductions (JCS-16-95), 5/24/95, Table 3.
As a result, the only firms represented are individual proprietorships, partnerships and Subchapter S corporations.
Part of the problem with the Census Bureau report is its use of administrative data which includes only individual proprietorships, partnerships and Subchapter S corporations.
2) Joint Committee on Taxation, Present Law and Proposals Relating To Subchapter S Corporations and Home Office Deductions (JCS-16-95), 5/24/95, Table 3.
This is because the Census counts only individual proprietorships, partnerships and Subchapter S Corporations, while excluding other legal forms of business organization, including Subchapter C Corporations.