When you want to elevate your business and enjoy the tax advantages of becoming an S Corporation, you need help from the experts.

This is where our team at Performance Financial comes in. We will help you understand what an S-Corp is and how it differs from an LLC. Then, we'll guide you through the complicated process to ensure you correctly create your business entity, keeping your company compliant.

Get tips from our experts, and explore how to create an S-Corp in Des Moines.

What Is an S Corporation?

First things first, you might wonder what an S-Corp is. This is a business structure that allows pass-through taxation. What does that mean? Basically, it means the company doesn't pay federal income taxes. Instead, the profits and losses "pass through" to the shareholders on their personal tax returns. This can result in significant tax benefits for businesses with high profits and low owner salaries.

Intrigued and ready to learn more? Check out what goes into creating an S-Corp.

How to Create an S-Corp in Des Moines

When setting up your business as an S-Corporation, hiring an experienced accountant is essential to help you complete the process. A lot goes into creating an S-Corp, and taking the correct steps is necessary. Avoid costly mistakes, and let our CPAs guide you through the following process.

Choose a Business Name

The first step is to create a business name. Brainstorm a unique name for your S-Corp that is creative, catchy, and makes sense for your company. You also need to ensure the name you choose is available. You can check the availability of the name on the Iowa Secretary of State website.

Appoint Directors and a Registered Agent

Next, you need to appoint a director and a registered agent. The director oversees the corporation's operations. You can name yourself the director or appoint someone else.

A registered agent is a person or company authorized to receive legal documents on behalf of your S-Corp. You can use a professional service for this.

File Articles of Incorporation

Then, you can file the Articles of Incorporation online or by mail. These formally establish your S-Corp with Iowa's Secretary of State. There is a filing fee that you must pay.

Create S Corporation Bylaws

When creating an S-Corp, it is recommended that you establish bylaws that govern the company's operation of shareholder rights. These are not mandatory, but we suggest them, as they can help you avoid disputes in the future.

Obtain an Employer Identification Number (EIN)

All S-Corps must have an EIN or an IRS identification number. You can obtain these through the IRS website.

Elect S Corporation Status

You must file Form 2553 with the IRS to officially become an S-Corp. This must be completed accurately, so filling this form out with a CPA is crucial. They will walk you through the required information.

Should I File As An S-Corp Or An LLC?

What's the difference between an S-Corp and an LLC? Which is best for your company? The best way to answer this is to work with our trusted accountants. However, our CPAs offer some quick guidance to help you understand their key differences.

In general, you should select an LLC if:

• You have multiple owners with complex profit-sharing structures.
• You want a more straightforward tax filing process (no salary requirement).
• There are no restrictions on ownership (nationality, residency).

You should opt for an S-Corp if:

• You have high profits and owner salaries (to avoid double taxation).
• You have a limited number of shareholders who meet S-Corp qualifications.

Not sure what's suitable for your company? Get help from our accountants!

How Performance Financial Tax and Accounting Makes S-Corporations Easy

One of the best tax reduction strategies in the United States is using an S-Corp. Performance Financial tax and accounting can help you understand when is a good time to become an S-Corp, and how to convert to an S-Corp. If you're already a sole proprietor, we can provide all the support services necessary to keep you compliant and enjoy all the benefits.

We'll also help you complete all the proper documentation, paperwork, payroll, and guidance, as well as the process and the paperwork.

Call Performance Financial For S-Corp Services

Call Performance Financial's trusted, experienced accountants when you need S-Corp services. We offer complete accounting, tax preparation and planning, bookkeeping, and payroll services in Des Moines, IA. Contact us today to schedule a consultation!

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