Browsing: Form 1120S

Form 1120S is a tax document used by S corporations to report their income, deductions, gains, losses, and credits to the IRS. Since S corporations are pass-through entities, their financial information flows directly to shareholders, who report it on their individual tax returns. This form ensures compliance with tax regulations and helps businesses accurately document their financial activities throughout the tax year.

The form consists of multiple sections, including details on ordinary business income, rental real estate income, and shareholder distributions. S corporations must file Form 1120S annually, even if they had no income or activity during the year. Proper completion of this form is crucial for maintaining tax compliance and avoiding penalties. Additionally, shareholders receive a Schedule K-1, which outlines their share of the corporation’s income and deductions.