S corporation set up may be fruitful for several reasons:
- Forming S corporation generally allows you to pass business losses through to your personal income tax return, where you can use it to offset any income that you have from other sources.
- S Corp shareholders are not subject to self-employment taxes. These taxes, which add up to more than 15% of your income, are used to pay your Social Security and Medicare taxes.
- When you sell your S Corp, your taxable gain on the sale of the business can be less than it would have been had you operated the business as a regular corporation.
- S corporation is not a corporation structure, it is a tax structure and you file the election with the Internal Revenue Service to file your taxes as an S Corporation.
- LLC can file corporation taxes as an S Corporation too
You can use the following link to check if your state requires to file an S Corporation election with the state.
https://www.infotaxsquare.com/article/filing-s-corporation-election.html
