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An S corporation (or S Corp), for United States federal income tax, is a closely held corporation (or, in some cases, a limited liability company (LLC) or a partnership) that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code. [1]
It combines the simplicity and flexibility of an LLC with the tax benefits of an S-corporation (self-employment tax savings). [28] Some legal scholars argue that corporate income taxes are intended to limit the power of corporations and to offset the legal benefits corporations enjoy, such as limited liability for their investors. [29]
In some cases, LLCs can elect to be taxed as S corporations, which can offer tax benefits. B corporation. B corporations, also called benefit corporations, are for-profit entities that aim to work ...
However, if the foreign entity had elected to be taxed as a corporation (or been classified as such by default), paid a low rate tax in the foreign country, then repatriated its income to the US by paying qualified dividends to its owner, the total proportion of tax paid on income might actually be less, as qualified dividends are only taxed at ...
Continue reading ->The post Should You Choose S Corp Tax Status for your LLC? appeared first on SmartAsset Blog. If you have a limited liability company (LLC), electing to tax it an S corporation ...
They can choose to be taxed as a partnership, but they can also decide to be taxed as a corporate-entity. Partnerships are not taxed, but corporations are. For LLCs taxed as partnerships the income is taxed to the partners. For a corporation or an LLC taxed like a corporation, the entity is subject to tax and dividends on after tax income are ...
It's not always straightforward how an LLC works and what it means for you, however. Here we'll … Continue reading → The post LLC Tax Rates and Rules appeared first on SmartAsset Blog.
Some entities treated as corporations may make other elections that enable corporate income to be taxed only at the shareholder level, and not at the corporate level. Such entities are treated similarly to partnerships. The income of the entity is not taxed at the corporate level, and the members must pay tax on their share of the entity's income.