Form with which a corporation may resolve to alter its corporate status top that of a subchapter (S) corporation.
S Corporation With Two Shareholders In Santa Clara
State:
Multi-State
County:
Santa Clara
Control #:
US-0046-CR
Format:
Word;
Rich Text
Instant download
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FAQ
Unlike sole proprietorships, a corporation can be owned by multiple people.
To qualify for S corporation status, the corporation must meet the following requirements: Be a domestic corporation. Have only allowable shareholders. Have no more than 100 shareholders. Have only one class of stock.
Limited number of shareholders: An S corp cannot have more than 100 shareholders, meaning it can't go public and limiting its ability to raise capital from new investors.
LLCs can have an unlimited number of members; S corps can have no more than 100 shareholders (owners).
In addition to the minimum franchise tax, a California S-Corp is also taxed on 1.5% of its business net profit. This tax is based on the net income of the California S-Corp. It is worth noting that the 1.5% tax does not apply if the 1.5% tax on business net profit is less than the $800 minimum franchise tax.
If you cancel your LLC within one year of organizing, you can file Short form cancellation (SOS Form LLC-4/8) with the SOS. Your LLC will not be subject to the annual $800 tax for its first tax year.
An S corporation's annual tax is the greater of 1.5 percent of the corporation's net income or $800.
How to Start an S Corp in California Step 1: Check Name Availability. Step 2: Choose a Business Name. Step 3: Obtain an EIN. Step 4: File Articles of Incorporation. Step 5: Registered Agent. Step 6: Corporate Bylaws. Step 7: S Corp Director Election. Step 8: Meeting Requirements.