When starting a new company, selecting the right business entity to form is a very important first step.
Historically, incorporating your business and electing S- Corporation status for taxation purposes was one of the most common approaches taken when forming a new company. This was especially true with small, family-owned business (often referred to as “closely held corporations”). This approach was perfect for limiting the owners’ personal liability and for allowing the business entity to act as a pass-thru entity for purposes of taxation to avoid double taxation.