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S Corporation

Starting an S Corporation
in as Few as 10 Minutes

START YOUR BUSINESS WITH CONFIDENCE. AFFORDABLE. FAST. SIMPLE.

  • Minimize your personal liability and shield your personal assets
  • We’ll prepare and file all required documents with the Secretary of State

Starting an S Corp Online is Easy

Our three-step formation process will have your business up and running HF Consulting

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Tell Us About Your Business

Starting an S Corporation doesn’t need to be complex or time-consuming. With our easy online form, you can be done in as few as 10 minutes.

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We File The Paperwork

We incorporate your S Corporation by preparing all required documents and filing them directly with the Secretary of State.

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Receive Your Documents

Once your incorporation documents have been approved by the state, you will receive your completed S Corp package by mail.

Why Business Owners Choose HF Consulting

Every day businesses from all over the nation choose HF Consulting to form their business.
Here are a just a few of the reasons why so many owners choose us to help start their business.

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Trusted And Experienced

Our Business Specialists will form your new business the correct way, saving you time and money by avoiding costly errors. Let us handle your business filings while you focus on growing your business.

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Personal Customer Support

Each one of our customers is assigned a personal Business Specialist. Have a question? Just call your personal Business Specialist directly. No need to wait in a pool of phone calls.

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Fast Turnaround Time

When you place your order through HF Consulting, we can immediately start the process of forming your new business. Our processing times are some of the fastest in the industry.

Why choose an S Corp?

100% Satisfaction Guarantee

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PERSONAL ASSET PROTECTION

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PASS-THROUGH TAXATION

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ABILITY TO RAISE CAPITAL

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LIMITED OPTION TO SELL SHARES

What sets S Corps apart

The most common business structure for small businesses is the S Corp, which differ from C Corps in that they have a special tax status with the IRS. While they still file a federal tax return, they don’t pay income tax at the corporate level. Rather, the profits and losses of the business are “passed-through” the business to the owners’ personal tax returns, meaning taxes are paid at a personal tax rate rather than a corporate tax rate. Learn more about the pros and cons of forming an S Corp here.

Choose the Right Business Type

Compare the important differences of each business structure to decide
which one is right for your company.

Protection

LLC

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LLCs provide personal asset protection, which shields you from being personally liable for business debts.

C CORP

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C Corps provide personal asset protection, which shields you from being personally liable for business debts.

S CORP

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S Corps provide personal asset protection, which shields you from being personally liable for business debts.

DBA

Owners have no personal asset protection, which makes them personally liable for business debts.

Managing Your Business

LLC

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LLCs must be member or manager managed according to the terms of the operating agreement. Member managed means the owners of the company manage the company. Manager-managed means the members (or owners) elect one or more managers to manage the company.

C CORP

C Corps are required to have shareholder elected directors who oversee and elect officers to run the day-to-day operations of the company. The business owner(s) can be the shareholder(s), the director(s) and officer(s).

S CORP

S Corps are required to have shareholder elected directors who oversee and elect officers to run the day-to-day operations of the company. The business owner(s) can be the shareholder(s), the director(s) and officer(s).

DBA

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The DBA owner may manage the business without restriction.

LLC

Varies

Changes in ownership of an LLC are dependent on the terms of the operating agreement.

C CORP

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Ownership changes in a C Corp are easily made through the sell of stock to new or existing shareholders.

S CORP

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Ownership changes in an S Corp are easily made through the sell of stock to new or existing shareholders.

DBA

DBAs cannot make ownership changes.

LLC

Varies

The life of the LLC is dependent of the terms of the operating agreement. Its existence may be short term or perpetual that survive the death or transfer of the membership interests of the original founders.

C CORP

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C Corps are separate entities that survive the death or transfer of stock of the owners and/or major shareholders.

S CORP

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S Corps are separate entities that survive the death or transfer of stock of the owners and/or major shareholders.

DBA

DBAs end upon closure of the company or the death of the owner.

LLC

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Depending on the state of incorporation, an LLC may be required to file an annual report and/or pay franchise fees.

C CORP

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After formation, C Corps have many ongoing formalities such as writing bylaws, selecting directors, holding initial and annual shareholder meetings, and issuing stock.

S CORP

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After formation, S Corps have many ongoing formalities such as writing bylaws, selecting directors, holding initial and annual shareholder meetings, and issuing stock.

DBA

There are no ongoing corporate formalities.

LLC

Varies

LLCs are not allowed to sell stock but may be able to raise capital via bank loans, from its members and various other avenues. Any equity to sales to third parties needs to be done in compliance with SEC regulations.

C CORP

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C Corps may issue many types of stocks, which may be sold to an unlimited number of shareholders. Any equity sales to third parties needs to be done in compliance with SEC regulations.

S CORP

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S Corps may issue one type of stock, which may be sold to a maximum of 100 shareholders. Any equity sales to third parties needs to be done in compliance with SEC regulations.

DBA

DBAs are not allowed to sell stock but may be able to obtain bank loans.

Tax

LLC

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LLCs are not taxed at the corporate level. Instead, all profit and losses are reported with the personal income taxes of each member.

C CORP

The income of the C Corp is taxed at the corporate level and then again at the shareholder level.

S CORP

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S Corps are not taxed at the corporate level. Instead, all profit and losses are reported with the personal income taxes of each shareholder (owner).

DBA

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DBAs are not taxed at the company level. All profit and losses are reported on the personal income tax return of the owner.

LLC

LLCs are not taxed at the corporate level.

C CORP

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The income of the C Corp is taxed at the corporate level and then again at the shareholder level.

S CORP

S Corps are not taxed at the corporate level.

DBA

DBAs are not taxed at the corporate level.

State Filing Fees

LLC

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LLCs are required to pay formation fees to the state. Fees will vary based on the state of incorporation.

C CORP

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C Corps are required to pay formation fees to the state. Fees will vary based on the state of incorporation.

S CORP

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S Corps are required to pay formation fees to the state. Fees will vary based on the state of incorporation.

DBA

There are required filing fees for DBAs. Fees will vary based on the county and state in which the DBA is filed.

LLC

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Depending on the state of incorporation, reports and fees may be required.

C CORP

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An annual report and franchise fees are generally due each year along with other reports and fees, which varies depending on the state of incorporation.

S CORP

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An annual report and franchise fees are generally due each year along with other reports and fees, which varies depending on the state of incorporation.

DBA

There are no ongoing compliance fees.

Advantages of Starting an S Corp

These are a few of the reasons why S Corps are among the most common business
filing types for small businesses.

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PROTECTION FROM PERSONAL DEBTS AND LIABILITIES

For businesses that choose an LLC business structure, their personal assets are considered separate from the personal interest invested in the company. This means that debts and liabilities incurred are the responsibility of the business rather than its members.

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PROTECTION OF PERSONAL ASSETS

S Corps are granted limited liability protection status, preventing courts from pursuing an owner or shareholder’s personal assets to pay debts held by the business.

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ABILITY TO EASILY CONVERT

As your business grows, it may also outgrow the entity type you originally filed as. Because S Corps only majorly differ from C Corps in how they’re taxed, it’s not difficult to convert to a different entity type need be.

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PASS-THROUGH TAXATION

The most notable benefit provided to S Corps is their “pass through” taxation status, which can help owners reduce their overall tax liability. Also, S Corporations are unique in that they have the ability to distribute stock, but only to a limited number of owners.

Are You Ready to Begin?

Launch your business today starting at $49 + state fees. See detailed pricing
We also offer a 2-Easy Payment Plan to help get your business up and running quickly.

Included In All Of Our Packages

  • Verify Company Name Availability
  • Preparation of Articles of Incorporation
  • Document Filing with Secretary of State
  • Dedicated Business Specialist
  • 100% Satisfaction Guarantee
  • Online Access to Your S Corp Documents
  • Certificate of Incorporation
  • Lifetime Customer Support
  • Delivery of Documents

Common Questions About Starting an S Corporation

If you have more questions, please give us a call at 917-791-0636. We love to help!

The S Corporation structure is very similar to the C Corporation, with a few notable differences. The most important of these differences is that S Corporations are eligible for special pass through taxation status with the IRS. This allows S Corporation owners to avoid double taxation on their business income.

Outside of some state-specific regulations that require individuals to be 18 to own a business, there are no restrictions on who can form a corporation. However, if a corporation decides to elect for S Corporation status, there are several restrictions placed on who can become part of the organizations ownership. They are as follows:

  • All S Corporation shareholders must be legal citizens of the United States.
  • S Corporations are only able to distribute one uniform class of stock.
  • S Corporation are limited to 100 different shareholders
  • Subsidiary organizations may not have an ownership interest in an S Corporation; all shareholders must be individuals.

One of the most common reasons that business owners elect to form an S Corporation is that the structure is eligible for pass-through taxation. Under this special tax status, the corporation is never taxed on its income. Instead, each individual owner is taxed on the company’s profits and losses, as they are distributed and reflected on their personal income tax returns.

Most states only require one director in order to start an S Corporation. However, some states impose a minimum number of directors based on the number of shareholders the company has. This required number is typically never lower than three and there is no maximum limit.

Articles of Incorporation must be filed in order form your S Corp. This document contains basic information about the company, its owners, and its directors. Depending on the state of incorporation, there may also be state-level fees or taxes that must be paid.

A filing service such as HF Consulting can take care of the required filings for an S Corporation. This allows you to focus on developing and growing your new company.

An attorney is typically not required when starting a business. A business filing service such as HF Consulting can help you streamline the formation process, and save you a great deal of time, effort, and money. However, if you are unsure of which business structure may be right for you, or you have questions regarding specific tax or organizational issues, it may be advisable to speak with an attorney or accountant before starting a new business.

Your company name must be unique and not deceptively similar to any other trademarked name or business. It is also required that your name not intentionally misrepresent the products or services you offer. For starting an S Corps, most states require a signifier of your corporate status, such as “Company”, “Corporation”, “Incorporated”, or a relevant abbreviation to be added to your business name. Choosing a name for your S Corp is an important decision, so take time to research and select a name that will accurately represent you and your business.

One of the most common reasons that business owners elect to start an S Corp is that the structure is eligible for pass-through taxation. Under this special tax status, the corporation is never taxed on its income. Instead, each individual owner is taxed on the company’s profits and losses, as they are distributed and reflected on their personal income tax returns. This more often than not results in favorable tax implications for each of the company’s owners.

S Corps must explicitly list the number of shares that they will be distributing initially, along with their par value, in their Articles of Organization. Once the number of shares has been recognized by the state, the company is free to distribute each share as they wish, as long as it is in accordance with the ownership restrictions placed on S Corps. The number of shares (and their par value) may be altered in the future by filing a document called a Share Amendment with the state.

The par value is mainly a formality and is typically $.01, $1, or no value. This figure is determined by the company and may have some minor tax implications. The par value is not the value of the stock issued by the company. For more information or specific questions regarding par value, it is advisable to speak with an accountant.

There are three different formal leadership positions that make up an S Corporation, with each having their own role or responsibilities. An individual is able to, and will often, serve in more than one of these positions. They are as follows:

1. Shareholder – Shareholders are the owners of the corporation and are able to vote in the election of directors and on other major corporate issues. They are not responsible for the day-to-day operations of the company.

2. Director – Directors are elected by the shareholders and make major business decisions in a manner that will be in the best interest of the company’s investors. They also supervise the company’s officers.

3. Officer – Officers are responsible for managing the day-to-day operations of the company.

Some of the most popular states in which companies typically choose to incorporate are Nevada, Delaware, and Wyoming. Many new S Corp owners do not realize that it is possible to incorporate in a state other than the one in which they live or operate. However, through a process called “foreign qualification”, it is possible and often advisable.

If your company operates only in a small area, it may be advisable to file within your state. The main reason for this is that many states require corporations that foreign qualify to pay additional taxes and fees which can be a financial burden for smaller companies. There are also some logistical issues that are related to foreign qualification that may cause additional expenses.

If your company is large, has many shareholders, or operates on a large geographical scale, foreign qualification may be the best option. Each state has different tax and filing requirements so it may be advantageous for your company to foreign qualify.

There are certain states that will require you to publish a notice of business formation in the local newspaper(s) such as Arizona, New York, Nebraska, and Pennsylvania. This requirement can be met by using a filing service such as HF Consulting.

All formal business entities, including S Corps, are required to have a Registered Agent on file with the state at all times. The agent may be an individual or company with a physical address located in the state of incorporation. Agents must be available at all times during standard business hours (9 a.m. – 5 p.m. Monday – Friday). The role of a Registered Agent is to receive any and all of communications from the government to the business. The agent’s name and address must be disclosed as part of the company’s public record.

If you are foreign qualifying your business or wish to keep your contact information private, it may be wise to hire a professional Registered Agent service such as HF Consulting. Our professional Registered Agent service ensures that your legal requirements will be fulfilled and that all communications will be relayed to your company in a timely manner.

HF Consulting offers a professional Registered Agent service as well business filing services. Regardless of the state in which your business is located, we can provide you with Registered Agent services. HF Consulting provides companies of all types and sizes an affordable solution that will ensure that they remain compliant with all Registered Agent requirements.

The first step to incorporating as an S Corp is to file your company’s Articles of Incorporation with the state in which you are establishing your business. Once this has been completed, there will be a set of formal compliance processes that your business must conduct. These processes are as follows:

1. Hold a documented organizational meeting with your initial board of directors. During this meeting you will need to adopt a written set of by-laws, approve resolutions establishing the company’s initial financial accounts and appoint officers.

2. Distribute all initial stock and document the distributions in an official ledger. This ledger must be continuously updated to reflect all stock transfers.

There may be some state specific requirements that you must observe during these processes as well. Also, keep in mind that S Corps have many ongoing compliance requirements that will need to be fulfilled on an annual basis.

BIZCOMPARE

View and compare the different types of business structures to help you understand
the benefits of each.

We’re here to help. Call Us to speak with a Business Specialist
917-426-8704