In Wyoming, you may incorporate a S corporation (S corp) by founding a limited liability company (LLC) or a corporation and then choosing S corp status from the IRS when applying for an EIN.
An S corporation is a tax categorization, not a company structure, according to the IRS. The S corp classification is used to lower a company’s tax burden.
In our How to Start a S Corp in Wyoming tutorial, we’ll walk you through the steps.
Table of Contents
Considerations Before Forming a S Corp
You must examine the following things before founding a S corporation:
Is a S corporation the best option for your company?
S corporation limitations
Why is an LLC the ideal structure for the S corporation tax status?
Are the tax benefits of a S corporation good for you?
Is a S Corporation the Best Business Structure for You?
Restrictions on S Corporations
S corporations are restricted to one class of stock and 100 stockholders, among other things. For more information, see our What Is a S Corporation? guide.
Why is an LLC the best structure for S Corporation tax status?
As entrepreneurs, we feel that incorporating a S corporation via an LLC is the best option since the benefits of founding a corporation are offset by S corp limitations. LLCs are also less difficult to manage than corporations.
Are S Corporation Tax Benefits Right for You?
You must determine if the S corp tax status is preferable to the default LLC tax status for your company. Read our LLC vs. S corp tutorial to fully grasp the tax benefits of a S corp.
How to Form a S Corporation
There are two major methods to form a S corporation:
When requesting your employee identification number, organize an LLC and obtain S corp tax status from the IRS (EIN)
By creating a company and applying to the IRS for S corp status
We do not advocate forming a company with the S corp tax status since it undermines all of the advantages of forming a corporation.
Forming an LLC and Choosing S Corp Status in Wyoming
To form an LLC and elect S corp status, follow these five simple steps:
Step 1: Give Your LLC a Name
Step 2: Select a Registered Agent.
Step 3: Submit the Articles of Incorporation.
Create an Operating Agreement in Step 4
Step 5: Obtain an EIN and submit Form 2553 to elect S Corporation tax status.
Step 1: Give Your LLC a Name
The first and most significant step in forming an LLC in Wyoming is deciding on a name.
Make sure your name conforms with Wyoming naming regulations and is readily searched by prospective customers.
1. Follow the Wyoming LLC naming guidelines:
Your firm’s name must contain the words “limited liability company” or “limited company” or one of its acronyms (LLC, L.L.C., LC, L.C.). The abbreviation for “limited” is “ltd.,” whereas the abbreviation for “business” is “co.”
L3C, l3c, low profit limited liability company, low profit ltd. liability co., or low profit limited liability co. are all examples of low profit limited liability companies.
Your name cannot indicate that the LLC was formed for a purpose other than the one specified in its articles of incorporation.
Your LLC’s name cannot include any words or phrases that imply it is established under the Wyoming Business Corporation Act, the Wyoming Statutory Close Corporation Supplement, or the Nonprofit Corporation Act.
Any of the following terms (or words with similar meanings) must be approved by the state Division of Banking: bank, banker, banc, bancorp, bancorporation, banque, banquers, banco, banca, trust.
Any of the following terms must be approved by the state Department of Education: academy, college, educate, education, educational, institute, institution, school, or university.
Names that begin with the letter “A” followed by a space or punctuation, include special characters, or are in a language other than English must be reviewed again by the Wyoming Secretary of State.
Your name must be distinct from any other current company in the state. Wyoming reserved names are included.
2. Does the name exist in Wyoming? Do a business entity search on the Wyoming Secretary of State website to ensure the name you desire is accessible.
3. Is the URL accessible?
We suggest that you check to see whether your company’s name is accessible as a web domain. Even if you don’t intend to construct a company website right away, you may want to purchase the URL to prevent others from gaining it.
Step 2: Select a Wyoming Registered Agent
Your Wyoming LLC must have a registered agent.
A registered agent for your LLC will accept legal papers and tax notifications on your behalf. When you submit your LLC’s Articles of Organization, you will name your registered agent.
Many company owners opt to use the services of a registered agent. Many of these firms will incorporate your LLC for a modest price and provide free registered agent services for the first year.
Wyoming Registered Agent Appointment Consent
Wyoming registered agents must use the Assent to Appointment by Registered Agent form to consent to their appointment.
The following information should be included in the consent statement:
The name of the registered agent
The registered office location
The name of the LLC
The signature of the registered agent
The date of implementation
If filing by mail, include the consent statement with your LLC’s formation forms. If you file electronically, you must tick a box to certify that your registered agent has signed the form.
Step 3: Fill out and submit the Wyoming LLC Articles of Organization.
To properly register an LLC, the Wyoming Articles of Organization are utilized.
Step 4: Draft an Operating Agreement for your LLC.
An LLC operating agreement is a legal document that defines your LLC’s ownership and member responsibilities.
Step 5: Apply for an EIN and fill out Form 2553 on the IRS website.
An EIN is a number assigned by the US Internal Revenue Service (IRS) to companies in order to identify and tax them. It is basically a business’s Social Security number.
When you apply directly with the IRS, EINs are free.
Select S Corporation Tax Status
The IRS will give a link to Form 2553, the Election by a Small Business form, during the online EIN application process.