Tax glossary

Form 1120-S

Form 1120-S — what it means, how it works, and a real example, explained without the jargon.

What is Form 1120-S?

Form 1120-S is the annual return an S corporation files to report income and each shareholder's share of it.

How it works

The S corp itself usually pays no income tax — the form is informational. It reports the company's profit and issues a Schedule K-1 to each shareholder, who then pays the tax personally. It's due March 15 for calendar-year filers.

A quick example

An S corp with two equal owners and $120,000 of profit files an 1120-S and sends each owner a K-1 showing $60,000 to report.

What people get wrong

The March 15 deadline is a month earlier than the personal one, and the late-filing penalty stacks per shareholder per month. Mark it early — it sneaks up on new S corp owners.

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Frequently asked questions

What does Form 1120-S mean?

Form 1120-S is the annual return an S corporation files to report income and each shareholder's share of it.

How does Form 1120-S work?

The S corp itself usually pays no income tax — the form is informational. It reports the company's profit and issues a Schedule K-1 to each shareholder, who then pays the tax personally. It's due March 15 for calendar-year filers.

What's the most common mistake with form 1120-s?

The March 15 deadline is a month earlier than the personal one, and the late-filing penalty stacks per shareholder per month. Mark it early — it sneaks up on new S corp owners.