An S Corporation is a type of business corporation.
An S Corp passes all their finances — corporate income, losses, deductions, and credits — through their shareholders. Because S Corp shareholders report the income and losses of the company on their own personal tax returns, the company isn’t subject to double taxation.
The shareholders of an S corp are the owners. They’re the ones who “hold” shares of stock.
Depending on how much stock they own, they have varying degrees of influence on the corporation — but they don’t make the decisions or run the day-to-day. Instead, they elect the company’s directors, who take care of all of that. They also vote to remove directors, when it seems like ...