How to Become an S Corp in Florida

You may have heard of S corporations if you’re planning to launch a business in Florida. S companies are a type of company entity that provides its owners with specific tax benefits and liability protections. So how does one set up a S corporation in Florida? The steps you must take are as follows:

1. Create a company: In Florida, creating a company is the first step in establishing a S corp. Choosing a name for your corporation, submitting your articles of incorporation to the Florida Secretary of State, and paying the necessary fees are all necessary steps in this process. After your corporation has been established, you must receive an Employer Identification Number (EIN) from the IRS. The IRS utilizes this special code to trace your company for tax-related purposes.

3. Submit Form 2553 to the IRS: In order to register as a S corporation, you must submit Form 2553 to the IRS. By submitting this form, your corporation notifies the IRS that it has chosen to be taxed as a S corporation. Within 75 days of the commencement of the corporation’s tax year, the form must be submitted. 4. Meet Eligibility Requirements: In order for your company to be eligible to become a S corporation, it must do a few things. For instance, the maximum number of shareholders is 100, and each shareholder must be a citizen or resident of the United States. Additionally, there can only be one class of stock in your company.

Can You Form a S Corp on Your Own? You can launch a S corporation on your own, yes. The above-mentioned actions, such as creating a corporation, obtaining an EIN, and submitting Form 2553, must still be followed. What Florida Taxes Does a S Corp Pay?

In Florida, S companies are typically only obliged to pay federal and state income taxes. S firms do not face double taxes, in contrast to C businesses. As a result, shareholders only pay tax on the corporation’s income once.

Your particular business needs and objectives will ultimately determine whether you should create an LLC or a S corporation. S companies have some tax benefits, whereas LLCs often require less setup and upkeep. You can make a wise choice by speaking with a business attorney or accountant.

S firms are required to pay its employees a fair wage, which is normally determined by the employee’s responsibilities and market rates. Payroll taxes are applicable to this salary, just like they are to any other employee’s wage. Furthermore, owners of S corporations are eligible to receive distributions of earnings, which are taxed at a lower rate than salary income.