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Small Business
What is an S-Corporation?
Defining a business as an S-Corporation is primarily done for its tax advantages. While the following explanation will no doubt answer your question as what it is, it is still extremely important that you involve an attorney or a CPA in your decision making process. They will be used in most of your future business negotiations and dealings, so now is an excellent time to involve them.

An S-Corporation is allowed to pass its profits and losses directly to the owners. Those owners can be shareholders but no more than a total of 75, all of whom need to be natural persons. A natural person is a legal way of saying, the shareholders can not be corporations. And every body holding shares in the company must be residents of the United States. Additionally, an S-corp can only issue a single class of stock.

One other but by no means, least important item: because of this status, the small business avoids the kind of double taxation delivered to C-Corporations.