A Form 1120S is also known as an U.S. Income Tax Return for S Corporations. An S Corporation is a corporation that elects to pass corporate income, losses, deductions, and credits through their shareholders. This will allow the corporation to avoid double taxation. To be considered an S Corporation, a corporation must be domestic, have no more than 100 shareholders, have only one stock class, and not be an ineligible form of corporation.
A company must already be considered an S Corporation before they use this tax return for their yearly tax filing. Like other types of tax returns, this form will require information about the corporation’s earnings, losses, deductions, and credits. This will ensure that the amount of taxes owed or refunded will be accurate. Other information may be required depending on the type of corporation and the number of employees at the company during the tax year.
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