must file an election form with the IRS. For tax purposes, an S corporation is considered a pass-through taxing mechanism. That is, the tax on the S corporation is passed through to the owners for federal income tax purposes. First, the corporation files a business tax return on Form 1120-S.What is the difference between S Corp and C Corp?
When a corporation is originally chartered by the state, it exists as a C Corporation. It will remain a C corporation unless the company wishes to elect S corporation status. The main difference between a C corporation and an S corporation is the taxation structure. S corporations only pay one level of taxation: at the shareholder level.What tax forms do C corporations file?
C corporations: C corps are separately taxable entities. They file a corporate tax return (Form 1120) and pay taxes at the corporate level. They also face the possibility of double taxation if corporate income is distributed to business owners as dividends, which are considered personal taxable income.