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Jacy, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 568
Experience:  Nine years individual income tax preparation and consulting
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Hi, I just had someone contact me requesting I do a business

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I just had someone contact me requesting I do a business tax return for them. They describe their business as: "It is a LLC as a Chapter S Corporation"?

Is that possible? If so, how does that work?


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Jacy :


Customer: replied 7 years ago.



This means you need to prepare an 1120S return. This return has K-1's which pass the income of the corporation to the shareholders (like a partnership).


Hope this is helpful to you



Jacy and 3 other Tax Specialists are ready to help you
Customer: replied 7 years ago.
Okay thank you. I've never heard of a business having to different classifications before. Is that common?

Yes, very common. the "S" stands for small. A corporation has to have less 30 shareholders to qualify.


Thanks again for your question!

Customer: replied 7 years ago.
Actually I was it common for a company to be an LLC and an S Corp?
I don't know how common it is. I do mostly individual income taxes so when someone tells me they have an LLC, I always ask what their business structure is: Sole prop., partnership, or corporation.