How to form an S-corporation for Cleaning


Forming an S-corporation is a great way to get your small business off the ground. If you want to be able to write off certain business expenses, like travel or car repairs, and be taxed as a pass-through entity rather than a regular corporation, this move might be for you. In this guide, we’ll walk through all of the steps involved in forming an S-corp from start to finish — including what it will take for you to actually start running your new business!

First, incorporated

The first step to forming an S corporation for your cleaning business is to understand what an S corporation is and how it works. An S corporation, also known as a subchapter S corporation or flow-through entity, is a type of business entity that gives its shareholders the same tax treatment as partnerships or limited liability companies. It’s also known as a regular C-corporation whose shareholders have elected to be taxed under subchapter S of the Internal Revenue Code. This means that all profits and losses are passed through to the shareholders, who report them on their personal income tax returns.

The benefit of this structure!

You can avoid double taxation; instead of paying taxes on your company’s profits twice—once when they’re earned by your company and again when they’re distributed to you in the form of dividends—you only pay taxes once on those earnings. The downside? You’ll need to make sure you don’t lose money every year (or else there won’t be anything left over for yourself at all).

Get your tax ID number from the IRS

You will need to apply for an Employer Identification Number (EIN), which you can do online at the IRS website. You will be asked to provide personal information, including your name and Social Security number, as well as a business name and contact person. The IRS may also ask for a contact email address so they can send you a confirmation letter once they have processed your application.

After submitting the application, it typically takes between 10-15 days before the IRS assigns you an EIN number.

You will need to produce a whole host of paperwork

This includes filing a tax return and an annual report. You will also need to file personal and corporate tax returns and other further paper work and documentation if any!

Business documents should be arranged!

To form an S-corporation, you’ll need to have all your business documents in order. That includes a business plan, website and social media presence, accounting system, contracts with clients and employees (if applicable), lease or other business property.

File your articles of incorporation

Once you’re ready to officially form your business, this needs to be filed with the state or local government office for the area in which your business will be based. An S-corporation is characterized by its tax structure: it’s taxed as a pass-through entity and not as an individual or a partnership. It can be beneficial for small business owners because it allows them to pay less in taxes each year. The benefit comes from being able to write off expenses related directly to running the business (and paying yourself as an owner), while not paying income tax directly on those profits until they are distributed as dividends at year end. If this sounds confusing, don’t worry! Our article on how corporations work can help explain things more clearly

Make some decisions about ownership

You can be the only owner of your corporation, or you can have more than one owner. In addition to deciding how many people will own the business, you’ll need to decide how much each person will own.

You can choose any combination of these options:

  • Only you as a sole proprietor
  • You and your spouse or domestic partner as co-owners
  • You and other family members (your parents may also want to be involved)

These steps will get you started on the road to running a small business

You can form an S-corporation by choosing this type of business entity when you apply for a tax ID number. The IRS website has a step-by-step guide on how to do this, but the process requires two forms: Form 2553 and Form 2553-EZ. You should also include the names of all shareholders and directors in your application, as well as any existing contracts between shareholders and directors. Once approved, an S-corporation will be recognized as separate from its owners for tax purposes.


If you’re looking to start a cleaning business and need help with the ins and outs of incorporating, we’ve got you covered. Our team at Trademark Avenue can walk you through each step of the process, from getting your tax ID number through filing your articles of incorporation. Just give us a call or visit our website today!

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