Form 1120-S is the annual federal income tax return filed by S-corporations with the IRS; it reports the company's income, deductions, credits, and each shareholder's allocable share — which flows to shareholders via Schedule K-1 (irs.gov/forms-pubs/about-form-1120-s).
Form 1120-S (U.S. Income Tax Return for an S Corporation) is the annual tax return that every S-corporation must file with the IRS. Because S-corps are pass-through entities under Subchapter S of the Internal Revenue Code, the corporation itself pays no federal income tax; instead, each shareholder's proportionate share of income, deductions, and credits flows to their personal Form 1040 via Schedule K-1 (Form 1120-S). Key sections of Form 1120-S: Page 1 reports total income, cost of goods sold, gross profit, deductions, and ordinary business income or loss. Schedule B collects information about shareholders and corporate structure. Schedule K aggregates all income/deduction/credit items allocated among shareholders. Schedule K-1 is the individual slip issued to each shareholder. Schedule L is the balance sheet. Schedule M-1 reconciles book income to taxable income. Schedule M-2 tracks accumulated adjustments account (AAA). For business financing: lenders use Form 1120-S as a primary income document when evaluating S-corp owner-operators. They examine ordinary business income (page 1 line 21), add back non-cash expenses (depreciation per Schedule K line 14), and review officer compensation (W-2). Two years of 1120-S returns are typically required. The IRS instructions are at irs.gov/pub/irs-pdf/i1120s.pdf. Due date: March 15 (calendar-year S-corps), with 6-month extension available via Form 7004.
Form 1120 is the C-corporation tax return; the C-corp pays entity-level federal income tax. Form 1120-S is the S-corporation return; the S-corp itself pays no federal income tax — income passes through to shareholders. The IRS requires a valid S-election (Form 2553) before a corporation can file 1120-S (irs.gov/forms-pubs/about-form-1120-s).
March 15 for calendar-year S-corps (the 15th day of the 3rd month after the end of the tax year). A 6-month automatic extension is available via Form 7004, pushing the deadline to September 15. Note that an extension of time to file is not an extension of time to pay estimated taxes (irs.gov/pub/irs-pdf/f7004.pdf).
Lenders take ordinary business income from page 1, add back depreciation/amortization from Schedule K, and may add officer compensation (W-2) if it was deducted. They typically require 2 years to assess income trend and average. Large year-over-year swings require explanation. Some programs also require the Schedule L balance sheet to assess liabilities (irs.gov/forms-pubs/about-form-1120-s).
Generally no federal income tax at the entity level — that is the defining feature of S-corp status. However, S-corps may owe a built-in gains tax (if converted from a C-corp within 5 years) and an excess net passive income tax. State-level franchise taxes or minimum taxes vary by state and are not affected by the S-election.