Someone will correct me if I’m wrong but I’ll try. A Sub S Corporation provides the protections against law suits, as a regular C Corporation. However, the income from a Sub S passes through to the owner as regular income and taxed as personal income. If the person is a C Corporation, he or she would have to pay both corporate taxes and personal taxes.
Yes, that’s how I understand it — but aren’t there expenses that would normally be paid by a C corporation that are instead paid by the S corporation’s owner(s) out of his (their) declared income, so that the owner’s (I’m getting sick of providing the alternate form!) income declared on his tax return is bigger than his actual income (as most people understand it) is? I know I’m phrasing this awkwardly, but, as I said, I read something about it years ago, and don’t really remember specifics.