During the early phases of a start-up it is even more so important to put everything in writing. You are laying the foundations to what may hopefully grow into a solid corporation. Many will feel the relationship with the chosen partner is strong enough to withstand any potential disagreement. Continue reading
If you’ve been following our blog for the past couple of Fridays, you know that we’re covering four basic tax tips to consider when forming a new entity. If you missed the first two, read up on the C-Corporation and S-Corporation.
The four considerations we’ve been covering are:
- Pass through of gains
- Pass through of losses
- Transfer of assets to the entity, and
- Transfer of assets from the entity Continue reading
With the tax season upon us, we’d like to help shed some light on tax issues. Every Friday for the next several weeks we will discuss how the following tax considerations apply to different business entities. (Look for the little piggies!) The considerations are:
- 1. Pass through of gains
- 2. Pass through of losses
- 3. Transfer of assets to the entity, and
- 4. Transfer of assets from the entity
This week we’re going to cover the S-corporation.
What is an S-corp?
For starters, an S-corporation starts just like a normal C-corporation. The letters (S & C) are designations from subchapters of the IRS code. Most corporations are C corporations. An S corporation is a corporation that has made a special election to be taxed in a certain way. Because of this special treatment, there are additional rules and restrictions on top of the standard corporate law requirements. Continue reading