If you are a business owner, I’m sure that you’ve heard about the term “S Corp” many times! But do you know what it is?
Many people think that S Corp (a short form of S Corporation) is another entity type similar to LLC or Sole Prop, but it is actually not.
S Corp is not a type of entity. It is an election for the business to be taxed in a certain way.
For example, one may own an LLC AND can elect for the LLC to be taxed as an S Corp.
It is often said that you will save taxes if you elect S Corp if you are making a profit of $30-40k or higher. (not sales, profit)
Although I agree with the statement, there are eligibility requirements and pros and cons. Also, everyone’s situation is different.
So I highly recommend working with your tax professional to consider what makes sense the most to you and your business.
Tax professionals will be able to help you with filing to be taxed as an S Corp as well. 🙂
