Lady Dianes Adventures INC has set up an S Corp, which is a unique type of corporation through an IRS tax election that has several benefits for users.

Forming an S Corp makes a lot of sense for businesses because through it an eligible domestic corporation can avoid double taxation. Quite simply it is a corporation that has been given the designation of Subchapter S from IRS. S Corps are quite special in the sense that they are considered to be separate, unique entity from those who own them. It also means that they offer business owners some sort of liability protection, which can go a long way in helping them.

But before one opts for them it’s important to understand what sets an S Corp apart from a regular corporation. The difference lies in the fact that in this case profits and losses can be channeled through one’s personal tax returns. As a result the business doesn’t get taxed. But there remains a caveat; a shareholder working for the company has to pay oneself decent compensation, which is usually set by the market value. Once these parameters are met, an S Corp can have the benefits that business owners look for.

How does one set up an S Corp is another important question many business owners are faced with? To do that, one has to charter a business to a corporation in the state where it has its headquarters. All the shareholders of the company then have to sign a form to agree to create an S Corp. Once the business is registered, one will have to get the permits and licenses. For any further dealings including hiring of employees businesses have to adhere to the regulations set in place for S Corps.

Tax saving is the main reason most businesses choose this option. Members of LLC have to pay employment tax on the entire net income of the business but here the tax is levied on only the wages of S Corp shareholder. Business expense tax credits and businesses having an independent life are some of the other benefits of forming an S Corp. Lady Dianes Adventures INC clearly seems to be aware of them, which is why its move seems to be a step in the right direction.

About Lady Dianes Adventures INC

It is a private company that has recently set up an S Corp and is reaping the benefits it has brought along with.

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