An S corporation, or S-corp, is a type of business entity in the United States that is recognized by the Internal Revenue Service (IRS) as a tax-exempt entity. S-corps are formed by filing articles of incorporation with the state in which the business is located, and they must also file a form with the IRS to request S-corp status. S-corps are similar to C corporations in that they are separate legal entities from their owners and offer limited liability protection to those owners, but they are taxed differently.

S-corps are taxed as pass-through entities, meaning that the business itself is not taxed on its profits. Instead, the profits and losses of the business are passed through to the owners, who report them on their personal tax returns. This means that S-corps can potentially offer tax advantages over other types of business entities, as the owners only pay taxes on their personal income rather than the business's income. However, there are some restrictions on who can own an S-corp, and the business must adhere to certain rules in order to maintain its S-corp status.

An S corporation (S corp) is a specific type of corporation in the United States that elects to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes. This election allows S corps to avoid double taxation on corporate income. Shareholders of S corps report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates.

To qualify as an S corporation, the business must meet specific IRS requirements: it must be a domestic corporation, have only allowable shareholders (which include individuals, certain trusts, and estates but not partnerships or corporations), have no more than 100 shareholders, have only one class of stock, and not be an ineligible corporation (such as certain financial institutions, insurance companies, and domestic international sales corporations).