How to Start an S Corporation
After touting the benefits of registering your business as a C corporation or LLC, we have finally landed on the topic of the ambiguously named S corporation.
Even though S corporations are mentioned in the same breath as LLCs or C corps, they’re actually quite different.
First of all, an S corporation isn’t a corporation at all -- it’s a neat little tax designation that you can add onto your existing LLC or C corp!
So why would I bother registering for an S corp?
Because becoming an S Corporation typically has big tax savings. Despite which entity you choose to register your business as, the more tax savings you can get means more cash to reinvest into your business!
You’ll want to obtain your employer identification number (EIN), a unique number that identifies your business for tax purposes. You can apply for your EIN online on the IRS website, over the phone, or via fax.
Once you’ve applied for and received your EIN, you will be able to file and process your state tax paperwork.
Register with the state government
First, you need to register your business as either an LLC or a C corp with the state government. You can either file the Articles of Organization for an LLC or the Articles of Incorporation for a C corp with your secretary of state.
Filling out the Articles of Incorporation or Organization will require you to provide the government with important information about your business, so youʼll need to choose a registered agent, principal place of business, and business purpose. Keep in mind that this information is publicly available.
Once you’ve paid your filing fees and sent off the articles to the secretary of state, you’re ready for the next step!
Create an S Corp
Once you register your LLC or C Corporation with the state, you have 2 months and 15 days to add the S Corporation designation. To do that, you'll need to file the paperwork with the IRS. After that time period, you'll want to check with your attorney or accountant to make sure you aren’t held accountable for any IRS penalties.
Congrats! You have an official company!
If you need help along the way, we can help you figure out what type of company is the best fit for you, decide where you need to register, and complete all the paperwork