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What is the meaning of having a sub-chapter status? Are there any tax advantage about this?

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Please visit this topic: http://startups.com/questions/493/llc-vs-s-corp-any-suggestions

Let me know if you have any questions. www.ninjatax.com

In accordance with Treasury Circular 230 (31 CFR part 10), please note: any information contained in this post is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer.

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A sub-chapter S is in deed a corp, which has all the requirements to be taxed under Sub-chapter S. The most important advantages that all entrepreneurs seem to consider when choosing this, is one layer of tax.

In a sub chapter S, net profits and net loss is administer among the stockholders, that have to include it on their tax returns To become a sub chapter S corp, you must have no more than 75 stockholders, all of them must live in the USA or in the territory you're in. You cannot have stockholders that live in other countries.

The other qualification is that you must choose to be taxed under sub-chapter S. The election has to be filed with the IRS before 15th day of the third month of taxable year. The form must be signed by ALL of the stockholders.

I'd like you to visit this website, it has a lot of data about sub-chapter S, taxation, and alternatives to it.

Hope it helps

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