Do-it-yourself Maine S Corporation Kit
Did you know that an S corporation can very easily save your Maine small business five to ten thousand dollars a year in payroll and income taxes?
And here's more good news: it's probably easier and cheaper than you think to set up an S corporation in Maine. All it takes is three relatively simple steps:
Step One: Form an Eligible Entity
Your eligible entity is the platform from which you will make the S Corp election. In most circumstances, the two practical options for types of eligible entities are limited liability companies and traditional corporations. If you choose to use an LLC to make the S corp election, you will fill out a "Certificate of Formation" form as your first step. If you choose use a traditional corporation as your platform to make the S corp election, you will fill out an "Articles of Incorporation" form as your first step.
Step Two: Get an Employer Identification Number
After you create an LLC or a corporation, the next step in making the Subchapter S election is getting an Employer Identification Number. To obtain your EIN, you fill out an SS-4 form. This form is available through the Internal Revenue Service website.
Step Three: Making the S Corp Election
The final step in becoming an S corporation is making the election to be treated as an S corporation. This means is that you wish your business to be treated with the tax laws described in Subchapter S of the tax code. To do this, you fill out a 2553 form and submit it to the Internal Revenue Service Center in Cincinnati, Ohio.
If you feel comfortable completing this process on your own, by all means do so. If you would like some friendly guidance, or at any time during the process you decide you need some help, consider downloading one of my do-it-yourself S corporation kits. I sell two versions of my kits. One kit describes using an LLC as the platform to make the election to be treated as an S corporation, and the other kit describes using a traditional corporation to make the election to be treated as an S corporation.
Version One: Using an LLC for your Maine S Corporation
This is my preferred method of making the Subchapter S election; LLCs are usually easier to manage than regular corporations. In addition to providing detailed instructions for completing all three steps, this kit describes the benefits and drawbacks of forming an LLC in Maine, and shows examples of what the completed forms look like for reference. I also include two sample operating agreements, one for single member (single owner) LLCs and another for multiple member (multiple owner) LLCs.Purchase and Download
Version Two: Using a Traditional Corporation for your Maine S Corporation
The other version of my do-it-yourself kit explains how to make the Subchapter S election using a traditional corporation. I (and many other accountants and attorneys) prefer using an LLC over a corporation because corporations are more complicated to manage. But, if you're really set on forming a corporation, perhaps you need "corporation" or "inc" in your business name for branding reasons, I provide a kit for that too.
This kit includes detailed instructions for completing the three steps involved in forming an S corporation, as well as a comprehensive discussion about the benefits and drawbacks of forming a traditional corporation. Like the LLC version of the kit, this kit includes examples of completed forms for reference. As a bonus, I include a set of sample corporate bylaws, which can be used by you or your attorney as a starting point for creating your own set of 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