by Author Name Withheld 13

Created on: December 17, 2008

You've decided to incorporate as an S Corporation. You figured that you'll have a tax advantage over regular corporations. Instead of suffering double taxation, you just want to get taxed once; paying taxes on your capital gains and other earned income. Though you get away from the headaches associated with regular corporations, you still have to file regular tax forms.

Go to the Internal Revenue Service's website, and type "S Corporations" in the search box. Select the hyper link that says "S Corporations." The page that you land on provides hyperlinks for tax forms; S Corporations have to file Income Tax, Estimated Tax, Employment taxes and Excise Taxes.

If you're also an S Corporation shareholder, you have to file Income and Estimated Tax.

Form 1120S is the U.S. Income tax Return for an S Corporation. It's set up like a regular 1040, but with differences. Place your business' basic information in the first part of this form. Include your incorporation date, Employer identification number, and the rest of the information. Continue through the form to complete your Income, Deductions, and Tax and payments information.

Complete and sign the signature section when you're done with this page.

Go on to Schedule A and complete your Cost of Goods Sold information, complete Schedule B for "Other" Information. Go on to Schedule K to complete your Income, Deductions, Credits, Foreign Transactions, Alternative Minimum Tax Items, items Affecting Shareholder Basis, Other Information, and Income Reconciliation data.

List your balance sheet information in Schedule L, your income reconciliation information in Schedule M-1, and your adjustments in Schedule M-2.

Compute your estimated taxes on Form 1120-W. This form stays with your S Corporation. Start with what you expect to make and place that amount in the first line. Answer each line item, as these follow a formula. Once you complete this form, you'll know what you owe, as an S Corporation. You'll have to make four payments over the year.

Now, your estimate may be very different from what you actually earned. If that's the case, you'll fill Schedule A out to adjust your income forecasts.

If you have employees working in your S Corporation, you'll have to file Form 941. This is where your employee payment records come in handy. Part 2 of this form allows you to report where you deposit the taxes you've taken from your employees.

If you've closed, or are just a seasonal operation, complete Part 3. If you had someone else file your

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