To learn more about the accounting methods, check out our guide on the cash vs accrual method. Most S-corps use the cash basis method of accounting.

Accounting method: The two accounting methods are cash and accrual.

Ask shareholders to provide you with Form W-9 as well.

Shareholder information: This includes the names, addresses, tax identification numbers (TINs), and percentage of ownership for every shareholder.

A complete list of business activity codes is found in the Instructions for Form 1120S.

Business activity: Briefly describe the business activity of the S-corp, the main product or service you offer, and the business activity code that reflects your industry.

Most S-corps are required to use the calendar year. This must match your prior-year return unless you ask the IRS permission to change.

Tax year: State whether you’re filing on a calendar year or fiscal year.

Details about your S-corp or LLC: The name of the business, the date the S-corp incorporated, the date of your S-corp election, employer identification number (EIN), and mailing address.

The eight things you need to complete Form 1120S include: The information includes financial statements and details about your shareholders.ĭownload the Form 1120S Checklist as a PDF. Whether you hire a tax professional to prepare your taxes or you use tax software, you’ll need information and documentation to complete 1120S. Gather the Necessary Information for Form 1120S Follow along to ensure that you understand each section:īelow you’ll find more detail about the 11 steps needed to complete Form 1120S. We’ll be using these numbers to complete our Form 1120S. We have created a sample profit and loss (P&L) statement and balance sheet that are shown below. The other three―Schedules L, M-1, and M-2―are conditional on whether the corporation has more than $250,000 in both revenue and assets. Three of them (Schedules B, D, and K), must be completed by all S-corps. In addition to the general information, income and deductions, and tax and payments section, Form 1120S has six schedules.

Either way, this article will help you understand the information required to complete your return. You can download Form 1120S and prepare the return manually, or prepare it and file it electronically with TaxAct, our pick for best overall small business tax software. Form 1120S is the annual tax form used by S corporations (S-corps) and limited liability companies (LLCs) taxed as S-corps to report their deductions, gains, losses, and income from the business during the current tax year.

Sample k1 tax form