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Glossary Term: S CORPORATION

Definition(s) for S CORPORATION:


1. ) refers to a type of ownership or corporation structure that limits its number of owners to 100. An S corporation does not pay taxes, rather its owners pay taxes on their proportion of the corporation's profits at their individual tax rates. A small business corporation permitted to be taxed substantially, as if it were a partnership or individual proprietorship. There is no corporate tax. Corporate losses can be claimed by the shareholders and corporate profits are taxed directly to the shareholders.

2. ) A corporation which bears no corporate tax and whose shareholders are taxed under the passthrough regime set forth in Subchapter S of the Internal Revenue Code See Appendix A, Section A 1



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