Business tax by entity type
How each type of business is taxed, how owners pay themselves, which deductions apply and which elections change the result.
25 guides in this topic
- How LLCs are taxed: the four options5 minute readThe four ways the IRS taxes an LLC: disregarded entity, partnership, C corporation or S corporation, with the forms, due dates and elections.
- How to pay yourself from an LLC4 minute readOwner's draws, guaranteed payments, S corp salary or C corp dividends: how LLC owners take money out, depending on how the LLC is taxed.
- S corp election: when it saves tax and when it doesn't4 minute readHow an S corp election saves payroll tax, two worked 2026 examples, the costs that eat into the saving, and how to make the election.
- Business expenses you can deduct: a working list5 minute readA working list of deductible business expenses for 2026, with the limits that apply, from home office and mileage to equipment and meals.
- Estimated quarterly taxes: who pays and how to work them out4 minute readWho must pay estimated tax, the 2026 due dates, the safe harbor rules that avoid the underpayment penalty, and how to pay the IRS.
- Reasonable salary for S corp owners3 minute readHow to set a reasonable salary as an S corp owner: the factors the IRS looks at, how to find a figure, what happens if it is too low, and records.
- Pass-through taxation explained2 minute readWhat pass-through taxation means, which businesses use it, how profit reaches owners' returns, tax on retained profit, and how it compares with a C corp.
- The qualified business income deduction explained3 minute readThe 2026 qualified business income (QBI) deduction: who qualifies, the 20% calculation, new thresholds, the $400 minimum, and service business limits.
- Home office deduction: who qualifies and how to calculate it3 minute readWho qualifies for the home office deduction, the regular and exclusive use test, the $5 per square foot method vs actual costs, and the S corp rules.
- Vehicle deduction: standard mileage rate vs actual costs3 minute readStandard mileage rate vs actual vehicle expenses for 2026: the rates, what each covers, the first-year switching rule, commuting and records.
- Franchise tax explained: which states charge it2 minute readWhat a state franchise tax is, how it differs from income tax, how states calculate it, examples from Texas, Delaware and California, and when an LLC owes it.
- How to file your first business tax return2 minute readHow to file a first business tax return: which form your business files, the due dates, what to gather, first-year elections and state filings.
- C corp double taxation: how it works3 minute readHow C corporation double taxation works: 21% corporate tax, then tax on dividends, the combined rate with examples, and the legitimate ways owners reduce it.
- Start-up and organizational costs: what you can deduct in year one2 minute readHow the start-up costs deduction works: up to $5,000 of start-up and $5,000 of organizational costs in year one, the phase-out and amortization.
- Meals, travel and entertainment: what is deductible3 minute readWhat the business meals deduction allows in 2026: 50% of business meals, 100% of travel costs, no deduction for entertainment, gifts and records.
- Depreciation, Section 179 and bonus depreciation in plain English3 minute readSection 179 vs bonus depreciation in plain English: how each works, the 2026 limits, losses, state rules, vehicles, and when slower is better.
- Husband and wife LLC: qualified joint venture vs partnership3 minute readHow a husband and wife LLC is taxed: partnership by default, the qualified joint venture rule, community property states and S corporations.
- Guaranteed payments to partners explained2 minute readGuaranteed payments to partners explained: how they differ from distributions and wages, tax treatment, self-employment tax, QBI and reporting.
- Business losses: when you can deduct them against other income3 minute readWhen business losses offset other income: the basis, at-risk and passive activity limits, the excess business loss rule, net operating losses, and hobby losses.
- Capital contributions vs loans to your own LLC3 minute readCapital contribution vs loan to your own LLC: tax and legal differences, documenting a loan, interest, repayment, basis, and Form 5472.
- How states tax LLC and S corp income3 minute readHow states tax LLC and S corporation income: pass-through to owners, entity-level taxes and fees, S status, non-resident owners and apportionment.
- States with no income tax: what that means for your business3 minute readThe nine states with no personal income tax on wages and business profit, the business taxes they still charge, and why moving does not avoid others.
- Pass-through entity tax elections explained3 minute readHow a pass-through entity tax election works: the entity pays state tax, deducts it federally, owners get a state credit, the SALT cap and timing.
- Hobby or business: how the IRS decides2 minute readHow the IRS decides between a hobby and a business: the nine factors, the 3-in-5-years profit presumption, why hobby expenses are not deductible.
- Late S corp election: how to get relief2 minute readHow to get relief for a late S corporation election: the 3 years and 75 days window, reasonable cause, filing under Rev. Proc. 2013-30.