S Corporation Taxation
The S corporation is arguably the most unique and creative business entity that exists in Texas today. In many ways, S corporations are a hybrid of other business types. If you are considering incorporating your business and expect it to be around for a long time, forming an S corporation may be an ideal solution for you. Contact the business formation professionals of Texas Legal Entities today at 512-472-2431 to discuss your legal options.
C Corps vs. S Corps
The traditional corporation, known as the C corporation, is subjected to double taxation. Not only must the corporation pay taxes on its profits, but any dividends that are then issued to shareholders are taxed as well. This tax structure can be a major disincentive for businesses who are considering incorporation. S corporations, however, operate as corporations but are not subjected to double taxation. Only the profits of the company are taxed, not the dividends issued to shareholders. They are therefore an excellent alternative for businesses that want the advantages of incorporation without the disadvantage of double taxation.
How We Can Help
Choosing a legal entity is an important decision for any business. The type of entity that you choose for your company will have lasting implications on how your business is run, how it is taxed, who is liable for losses, and more. Our business entity specialists understand how crucial this decision is for the future of your business, and we will work with you to help you find the structure that best meets your needs.
Contact Us
To learn more about S corporation formation and how it may affect your business, contact the business formation experts of Texas Legal Entities by calling 512-472-2431 today.
At any time, please feel free to ask us a question. It's FREE!