Where to Form an S Corporation
Most companies form corporations in the state in which they will primarily operate. Advantages of forming a corporation in your home state include:
- Typically the least complicated, if you only plan to operate the business in your home state
- Avoid paying franchise taxes and filing annual reports in more than one state
- Usually costs less to incorporate locally
Many companies conduct business throughout the United States and abroad. An S Corporation with business locations in multiple states may incorporate in a single state, then register to do business in other states. This means that S Corporations must formally register, file annual reports, and pay annual fees in every state in which they conduct business.
Remember, you must separately apply for S Corporation tax status through the IRS by filing form 2553.
Form your S Corporation online or contact a Business Specialist at 800-818-6082 (toll-free) or 302-636-5440.
