
Do you own an S Corporation and are wondering if you must make federal quarterly estimated tax payments? Read on to find out.
Generally speaking, an S Corporation usually does not incur any federal income tax. This is because it is what is called a "pass-through entity" for tax purposes. In other words, even though corporate profit does get reported on the federal corporate tax return, this return (Form 1120S) is really for information purposes only. Rather than have the S Corporation pay the income tax on its profits, those profits are passed on to the shareholders via a form called Schedule K-1. The shareholders must then report the corporate profits from Schedule K-1 on their personal tax returns, and that's where any income tax is reported and paid.