Customized Checklist of Required Documentation for S-Corp and C-Corp Tax Filings
Filing taxes for S-Corporations (S-Corp) and C-Corporations (C-Corp) requires a detailed and thorough approach. At Crystal Clear Tax, we ensure that both you and your business meet all necessary requirements by providing a tailored checklist of documents. The documentation needed may differ slightly depending on whether your business is an S-Corp or a C-Corp, so please review the checklist below to ensure you are fully prepared.
General Information for Both S-Corp and C-Corp
1. Business Information:
•Employer Identification Number (EIN): This is crucial for any corporate filings.
•Articles of Incorporation: Legal document establishing your corporation.
•Corporate Bylaws: Governing document that outlines the corporation’s structure and operations.
•Business licenses and any permits.
•State ID numbers for payroll or state taxes (if applicable).
2. Financial Statements:
•Profit and loss statement (P&L): Provide this for the full tax year.
•Balance sheet: Accurate as of the end of the tax year.
•Cash flow statement (optional but helpful for a clearer picture of your financials).
3. General Ledger:
•A comprehensive general ledger that details all of your business transactions. This should include:
•Income entries
•Expense entries
•Asset purchases
•Liabilities and debt transactions
4. Bank Statements:
•Provide copies of bank statements for the full tax year.
•Statements should cover checking, savings, and business credit card accounts.
5. Payroll Information:
•Payroll summaries for the full tax year.
•Details of owner’s salary, bonuses, and benefits paid to officers.
•Form W-2s and W-3s for all employees.
•1099s for contractors.
6. Expenses Documentation:
•Receipts or logs of business expenses such as office supplies, utilities, marketing costs, and other operational expenses.
•Mileage logs or travel expenses if applicable.
•Meals and entertainment expenses if relevant.
7. Asset Information:
•Documentation on any assets purchased or sold during the year, including vehicles, equipment, and real estate.
•Details of depreciation schedules for previously purchased assets.
8. Liabilities:
•Any loan agreements, credit lines, or other forms of business debt.
•Interest paid on loans.
9. Estimated Tax Payments:
•Provide records of estimated tax payments made throughout the year.
S-Corp-Specific Checklist:
1. Form 1120-S (U.S. Income Tax Return for an S Corporation):
•You will need to file Form 1120-S along with supporting schedules.
2. Shareholder Information:
•K-1s for each shareholder, reflecting each owner’s share of the corporation’s income, deductions, and credits.
•Details of distributions made to shareholders.
3. S-Corp Election Documentation:
•Form 2553 (Election by a Small Business Corporation) if this is your first year electing S-Corp status.
4. Health Insurance Premiums:
•Documentation of health insurance premiums paid on behalf of shareholders owning more than 2% of the company.
5. Officer’s Compensation:
•Records of reasonable compensation for officers, to ensure compliance with IRS guidelines on salary vs. distributions.
C-Corp-Specific Checklist:
1. Form 1120 (U.S. Corporation Income Tax Return):
•File Form 1120 for your C-Corp, along with required schedules.
2. Dividend Distribution:
•Documentation of any dividend distributions made to shareholders during the year.
3. Corporate Taxes Paid:
•Record of corporate tax payments made at both the federal and state level.
4. Shareholder Equity:
•Details of any shareholder equity transactions, including stock issuances, buybacks, and changes in ownership percentages.
5. Officer and Executive Compensation:
•Detailed records of compensation packages for high-level officers, including salary, bonuses, stock options, and benefits.
6. Corporate Deductions:
•Document all corporate deductions, including employee benefits, qualified business income deductions, and any research and development credits.
7. Net Operating Loss (NOL):
•If applicable, provide information on Net Operating Loss (NOL) carryforwards or carrybacks.
Additional Documentation for Both S-Corp and C-Corp:
•Tax Credits and Deductions: Documentation to support any eligible tax credits, such as:
•Research and Development (R&D) credits
•Energy-efficient equipment credits
•Employee retention credits (if applicable)
•Retirement Plan Contributions:
•Records of retirement plan contributions (e.g., SEP IRA, 401(k), SIMPLE IRA) for employees and owners.
Engagement Letter
Finally, all clients must sign the engagement letter to formalize our working relationship. Instructions for signing and document submission will be provided through Intuit Link, with a tutorial to guide you through the process.
Conclusion
Preparing your S-Corp or C-Corp taxes with Crystal Clear Tax is a collaborative effort. By gathering these documents in advance, you help ensure a smooth process and allow us to focus on optimizing your tax outcome. Whether it’s maximizing deductions, handling payroll complexities, or staying compliant with corporate regulations, we’re here to support you every step of the way. Let’s work together to make tax season stress-free!
