Which of the following statements best describes an S corporation?
A) It is a form of corporation with a limited number of owners that operates under simpler, less formal rules than a C corporation.
B) It is a form of corporation that does not seek to earn a profit and differs in several fundamental respects from C corporations.
C) It is a form of corporation that avoids double taxation by having its income taxed as if it were a partnership.
D) It is a form of corporation that can have only institutional investors as stockholders.

Question

Quizplus · Accepted Answer

An S corporation is designed to avoid double taxation by allowing income to be taxed at the shareholder level, similar to a partnership, rather than at the corporate level.

Which of the Following Statements Best Describes an S Corporation