The S-Corp has a very rich history as it derives its name from a tax code that was created and enacted into law by the Congress of the US in 1958. S-Corporations can only be owned by US citizens and it was created specifically to encourage small and family business creation. One of the critical benefits of the S-Corp is that it eliminates the double taxation that regular corporations are subjected to. With this structure, the liability of the owners and investors is limited to only the amount of their investment. This type of entity is not required to pay taxes on a corporate level. So how is it treated? The income generated by an S-Corporation will flow through to the personal income tax returns of the shareholders.

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