Do-it-yourself Louisiana S Corporation Kit
The upcoming taxes that flow out of the healthcare laws popularly known as Obamacare and the expiration of the tax reductions popularly known as the Bush tax cuts for high income taxpayers mean that many small businesses face tax increases in the coming year.
If you're a Louisiana business owner, you can of course simply fret and wring your hands about the effect of these changes on your business. But you can also take more concrete action to position yourself for long-term tax savings.
One of the most powerful tax planning gambits you have available is operating your active trade or business as an S corporation. An S corporation can save the typical successful business owner thousands of dollars in income and payroll taxes.
And here's more good news. The process for setting up an S corporation doesn't have to be that tricky. You can even do the work yourself by downloading one of the kits below and following these three basic steps:
Step 1: Form an LLC or a Corporation
A limited liability company or a regular corporation will function as the base for your S corporation. There are a few other types of businesses you could use, like a limited liability partnership, but LLCs and corporations are the most common. Fill out an Articles of Organization form to create an LLC, and submit it to the Louisiana Secretary of State along with $75 for the filing fee. To form a corporation, fill out an Articles of Incorporation form and submit it and $60 for the filing fee to the Secretary of State as well.
Step 2: Apply for an EIN
After you form a limited liability company or corporation, the next step is applying for an Employer Identification Number. An Employer Identification Number, or EIN, functions a bit like a Social Security Number for a business. Fill out an SS-4 form, which you can find on the Internal Revenue Service website. You should receive your EIN a few weeks after you submit the SS-4 form to the IRS.
Step 3: Elect Subchapter S Treatment
Once you receive your EIN you can take the final step in becoming an S corporation. Fill out a 2553 form to elect Subchapter S treatment. This form tells the IRS that you want your business to be treated using the laws found in Subchapter S of the Internal Revenue Code. Submit the completed 2553 form to the Internal Revenue Service Center in Ogden, Utah. The IRS then checks to make sure that your business is eligible to make the S corporation election and that you followed correct procedure before you receive S corporation status.
If you need a bit more instruction than what I provide above, consider one of my do-it-yourself kits. I created two affordable do-it-yourself S corporation kits in downloadable e-book form. One kit walks you through forming an S corporation using an LLC, and the other using a regular corporation.
LLC Do-It-Yourself Kit
In most cases, a business benefits more from using an LLC rather than a corporation. Corporations can be tricky to manage because of things like regular board meetings and stockholders meetings.
If you purchase my S corporation kit for $37.95, you will receive a complete set of instructions to guide you through the S corporation set-up process. I include filled-out examples of all the forms you will use to make completing them as easy as possible. I also include a discussion the pros and cons of forming an LLC in Louisiana.Purchase and Download
Corporation Do-It-Yourself Kit
Occasionally a business may find it more beneficial to use a corporation instead of an LLC to form an S corporation. For those business owners, my corporation kit provides all the tools needed to incorporate a business and make the S corporation election.
This kit comes with detailed instructions and examples of completed forms to walk you through incorporating your business, applying for an EIN and making the S corporation election. I also include an analysis of how to balance the benefits and drawbacks of incorporating in Louisiana. As a bonus, I added a sample set of corporate bylaws. You or your attorney can use these bylaws for reference when crafting your own corporate bylaws.Purchase and Download
Additional Information You May Find Useful
If you want additional information about how to maximize the tax savings related to running a business or investment venture, you may also be interested in one of our downloadable e-books (see descriptions below). Each book covers a category of tax planning topics that easily save a business owner significant amounts of income or self-employment taxes (potentially thousands of dollars a year) and is instantly downloadable.
Often the best tax saving tool private companies have? The Section 199A deduction which allows them to avoid taxes on the last 20 percent of their income.Read More
Using an S corporation for your business? To maximize savings, you need to minimize the salary paid to shareholders. But this decision is tricky.Read More
Nearly secret, the federal government's employee retention credits provide tremendous payroll tax savings for most small businesses... A new book from our firm explains.Info here