Is S-Corporation Status Still the Right Choice for Your Bank?

Audit and Accounting

September 01, 2013
by Susan Rammer, CPA

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Susan Rammer Susan Rammer, CPA
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The S corporation is one of the most common forms of business structures used by community banks. In the past, it was not difficult to see why a community bank might choose to make the S-corporation election. One of the major benefits of electing S-corporation status was the tax advantages that it had relative to C corporations. As a C corporation, income is taxed at the corporate level and AGAIN at the shareholder level upon distribution, resulting in double taxation. As an S corporation, income is taxed only once at the shareholder level. This is a significant tax benefit for an S corporation!

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