S Corporations and Form 1120-S

Eligibility, elections, shareholder basis, and distributions for S corporations.

Key sections and concepts

Section 1361

S corporation defined

Sets eligibility, including shareholder and one-class-of-stock rules.

Section 1362

S election

Covers making, revoking, and terminating the election.

Section 1366

Pass-through to shareholders

Passes income, losses, and credits through to shareholders.

Section 1367

Shareholder basis adjustments

Adjusts stock and debt basis for pass-through items.

Section 1368

Distributions

Determines how distributions to shareholders are taxed.

Section 1374

Built-in gains tax

Taxes certain gains of former C corporations.

Section 1375

Excess passive income tax

Taxes certain S corporations with excess passive income.

Section 1377

Pro rata share

Sets the per-share, per-day allocation rule.

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For general education only, not tax advice. Tax law changes often, so confirm current rules and amounts with primary sources.