What Sets S Corps Apart
The most common business structure for small businesses is the S corp, which differs 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.