Research

The S Corporation Report 2026: Returns, Net Income, Industry, and Shareholders

By The Ledgerism Editorial Team · The Ledgerism Brief Editorial Team produces original, methodology-disclosed accounting and tax research—data trackers, databases, and reference guides built to be the most-cited source in the field. Every figure is verified against primary sources including FASB, the IRS, the PCAOB, NASBA, the AICPA, and state boards of accountancy.

A data profile of the U.S. S corporation, built only from verifiable IRS and GAO primary sources. The S corporation (Form 1120-S) is now the most common corporate form in the United States. This report compiles the count of returns over time, total and average net income, the distribution by industry and by shareholder count, the long arc since the Tax Reform Act of 1986, and what IRS aggregate data can and cannot say about the reasonable-compensation debate.

Federal statistics lag. Every figure below carries its exact tax year (TY) or fiscal year (FY). The two main series are not interchangeable: the IRS Data Book counts returns filed in a federal fiscal year; the IRS Statistics of Income (SOI) Complete Report estimates the number of active corporations for a tax year. Both are stated explicitly throughout.

Executive summary

• The IRS received 6,080,370 Form 1120-S (S corporation) returns in fiscal year 2024, up 3.4% from 5,882,030 in fiscal year 2023 (IRS Data Book, FY2024, Table 2).
• S corporations filed roughly 2.7 times as many income tax returns as C and other corporations in FY2024 (6,080,370 vs 2,252,027) (IRS Data Book, FY2024, Table 2).
• For Tax Year 2022, SOI estimated 5,266,702 active S corporations, 76.9% of the 6,845,719 active corporations that year (IRS SOI, Publication 16 Complete Report, TY2022, Figure G).
• S corporations reported $763.3 billion in pretax profits (net income less deficit) for TY2022, up 1.1% from $755.3 billion in TY2021 (IRS SOI, Publication 16, TY2022).
• The number of S corporation returns grew about 537%, from 826,214 in TY1986 to 5,266,702 active returns in TY2022, a 6.4-fold increase (IRS SOI Integrated Business Data, 1980-2015; Publication 16, TY2022).
• S corporations overtook C corporations in number around Tax Year 1997, when active S corporation returns (2,452,254) first exceeded C corporation returns (2,248,065) (IRS SOI Integrated Business Data, 1980-2015).
• In TY2013, the most recent year with a full SOI S-corporation sector and shareholder breakdown, 63.4% of all S corporations had a single shareholder (2,701,050 of 4,257,909) (IRS SOI, Table 6, Form 1120-S, TY2013).
• A GAO analysis of IRS National Research Program data found about 13% of S corporations paid inadequate wage compensation in tax years 2003-2004, totaling just over $23.6 billion in net underpaid wages, with 1-to-3-shareholder firms accounting for almost all of it (GAO-10-195, December 2009).

Key findings

1. The IRS received 6,080,370 Form 1120-S returns in FY2024, an all-time high, up 3.4% year over year from 5,882,030 in FY2023 (IRS Data Book, FY2024, Table 2).
2. C or other corporation income tax returns (Form 1120 series excluding 1120-S) totaled 2,252,027 in FY2024, down 8.6% from FY2023 (IRS Data Book, FY2024, Table 2).
3. SOI estimated 5,266,702 active S corporations for TY2022, versus 1,514,763 active C corporations the same tax year (IRS SOI, Publication 16, TY2022, Figure G).
4. S corporations were 76.9% of all 6,845,719 active corporations for TY2022 (IRS SOI, Publication 16, TY2022, Figure G).
5. S corporation pretax profits (net income less deficit) reached $763.3 billion for TY2022 (IRS SOI, Publication 16, TY2022).
6. With investment, rental, and portfolio income included, S corporation pretax profits were $915.0 billion for TY2022 (IRS SOI, Publication 16, TY2022).
7. The S corporation count rose from 545,389 returns in TY1980 to 826,214 in TY1986, then jumped 36.5% to 1,127,905 in TY1987, the first tax year fully under the Tax Reform Act of 1986 (IRS SOI Integrated Business Data, 1980-2015).
8. S corporation total net income (less deficit) from a trade or business rose about 3.6-fold from TY1986 ($8.3 billion) to TY1987 ($30.0 billion) (IRS SOI Integrated Business Data, 1980-2015).
9. SOI reported S corporation filings grew at an average annual rate of 8.8% from the enactment of the 1986 Tax Reform Act through TY2003, while taxable (non-S) corporations declined about 1.4% per year (IRS SOI, “S Corporation Returns, 2003”).
10. For TY2003, S corporations were 61.9% of the 5.4 million corporate returns filed but only 20.4% of total corporate receipts and 4.1% of total corporate assets (IRS SOI, “S Corporation Returns, 2003”).
11. In TY2013, S corporations reported $446.2 billion in total net income (less deficit), an average of about $104,790 per return across 4,257,909 returns (IRS SOI, Table 6, Form 1120-S, TY2013).
12. In TY2013, S corporations deducted $254.0 billion in compensation of officers and $730.3 billion in salaries and wages (IRS SOI, Table 1, Form 1120-S, TY2013).
13. In TY2013, the largest S corporation industries by count were construction (544,711 returns), professional/scientific/technical services (702,282), and wholesale and retail trade (652,750) (IRS SOI, Table 1, Form 1120-S, TY2013).
14. About 13% of S corporations paid inadequate wage compensation in TY2003-2004, totaling just over $23.6 billion in net underpaid wages to shareholders (GAO-10-195, December 2009).
15. GAO estimated roughly $3 billion in employment-tax revenue loss over TY2003-2004 from inadequate S corporation wages, applying the 15.3% FICA rate to the underpayment (GAO-10-195, December 2009).

Section 1: How many S corporations are there?

Two official counts exist and they measure different things.

The IRS Data Book counts returns physically filed in a federal fiscal year. The IRS received 6,080,370 Form 1120-S returns in FY2024, up 3.4% from 5,882,030 in FY2023 (IRS Data Book, FY2024, Table 2). By the same table, C or other corporations filed 2,252,027 returns in FY2024, down 8.6% from FY2023. By filings, S corporations outnumber C and other corporations about 2.7 to 1.

The SOI Complete Report (Publication 16) estimates active corporations for a tax year from a stratified sample. For TY2022 it estimated 5,266,702 active S corporations out of 6,845,719 active corporations, or 76.9% (IRS SOI, Publication 16, TY2022, Figure G). The active-return series and the filing-count series differ because the Data Book includes part-year, amended-adjacent, and out-of-scope filings, while SOI restricts to active corporations and tabulates by tax year.

Both series agree on the central fact: the S corporation is the dominant corporate form. SOI’s stated population of Form 1120-S returns (a sampling-frame count, which exceeds the active-return estimate) was 5,638,658 for TY2022 (IRS SOI, Publication 16, TY2022, Figure E).

Limitation. SOI does not publish S corporation counts or net income by U.S. state. The corporation program tabulates S corporations by industry (NAICS) and by number of shareholders only. State-level corporate detail in the Data Book is not broken out for Form 1120-S separately from other return types in a way that isolates S corporations cleanly. Any state-by-state S corporation table circulating online is not an IRS SOI product. This is flagged as a data gap.

Table 1.1 Active S corporations vs C corporations, recent tax years (SOI estimates)

Source: IRS SOI, Publication 16 Complete Report, TY2022, Figure G. “S share” uses TY2022 total active corporations of 6,845,719.

Table 1.2 S corporation returns filed, IRS Data Book

Source: IRS Data Book, FY2024 (Publication 55-B), Table 2.

Section 2: The long arc since the Tax Reform Act of 1986

The modern S corporation is largely a creation of post-1986 tax policy. The Tax Reform Act of 1986 (TRA86) compressed individual rates below the top corporate rate for the first time in decades and tightened the corporate-level tax on built-in gains and liquidations, which made pass-through treatment relatively more attractive. Three later acts widened access further: the Revenue Reconciliation Acts of 1990 and 1993, and the Small Business Job Protection Act of 1996, which raised the shareholder cap (later set at 100) and broadened eligibility (IRS SOI, “S Corporation Returns, 2003”).

The count tells the story. S corporation returns rose only modestly through the early 1980s, then stepped up sharply after TRA86, growing 36.5% in a single year from TY1986 to TY1987. SOI reported an average annual growth rate of 8.8% from TRA86 through TY2003, while non-S taxable corporations shrank about 1.4% per year over the same window (IRS SOI, “S Corporation Returns, 2003”).

S corporations overtook C corporations in number around TY1997. In TY1996, active C corporations (2,317,886) still narrowly exceeded active S corporations (2,304,416); by TY1997 S corporations (2,452,254) had pulled ahead of C corporations (2,248,065) and never relinquished the lead (IRS SOI Integrated Business Data, 1980-2015).

Table 2.1 S corporation returns and total net income (less deficit), selected tax years, 1980-2015

[Net income is total net income less deficit, in thousands of dollars, as published. “n.a.” where SOI did not publish a comparable figure.]

Source: IRS SOI Integrated Business Data, “Selected financial data on businesses by form of business and tax year, 1980-2015.” Note that the S corporation “total net income (less deficit)” figures published in this series differ in early years from the narrower “net income from a trade or business” used in some SOI articles; the column above is total net income less deficit as published. Some 1980s entries reflect the pre-TRA86 election rules.

The TY2008-2009 dip in net income (from $400.7 billion in TY2007 to $272.5 billion in TY2009) tracks the financial crisis and recession, even as the return count kept climbing. That divergence, rising counts against falling profits, is itself a signal that S corporation formation is driven as much by liability and tax-structure choices as by current profitability.

Section 3: Net income, total and average

For TY2022, the most recent year with a published aggregate, S corporations reported $763.3 billion in pretax profits (net income less deficit), up 1.1% from $755.3 billion in TY2021 (IRS SOI, Publication 16, TY2022). When SOI adds the investment, rental, and portfolio income that S corporations pass through to shareholders, the comparable figure rises to $915.0 billion for TY2022 (IRS SOI, Publication 16, TY2022, comparison of all corporations, RICs, and S corporations).

For context, all active corporations reported $4,793.9 billion in pretax profits for TY2022, so the S corporation share of corporate pretax profits was about 15.9% (IRS SOI, Publication 16, TY2022; share derived). S corporations are the overwhelming majority of corporate entities but a minority of corporate profit dollars, because the largest profit pools sit in a small number of very large C corporations: returns with $2.5 billion or more in assets were 0.07% of all corporate returns but 76.7% of all corporate net income for TY2022 (IRS SOI, Publication 16, TY2022, Figure A).

The most recent year with a complete S-corporation-specific income statement and shareholder breakdown is TY2013. For TY2013, S corporations reported $446.2 billion in total net income (less deficit) across 4,257,909 returns, an average of about $104,790 per return (IRS SOI, Table 6, Form 1120-S, TY2013; average derived). TY2013 detail:

• Total receipts: $6,890.4 billion (IRS SOI, Table 6, TY2013).
• Total deductions: $6,507.8 billion (IRS SOI, Table 6, TY2013).
• Net income (less deficit) from a trade or business: $380.9 billion (IRS SOI, Table 6, TY2013).
• Total net income (less deficit), including portfolio and rental income: $446.2 billion (IRS SOI, Table 6, TY2013).
• Total assets: $3,741.8 billion (IRS SOI, Table 6, TY2013).

Section 4: Distribution by industry

S corporations cluster in labor-intensive, owner-operated service and trade industries rather than in capital-heavy sectors. The figures below are from the most recent SOI S-corporation sector tabulation, TY2013.

Table 4.1 S corporations by major industry, TY2013

Source: IRS SOI, Table 1, S Corporations: Total Receipts and Deductions, by Major Industry, TY2013. Shares derived from published counts; detail may not sum to 100% due to rounding and a small unclassified residual.

The pattern is informative. Manufacturing was just 3.7% of returns but produced $68.8 billion in net income, the second-highest of any sector, while construction was 12.8% of returns but only $42.7 billion. Per-return profitability varies widely by industry; counts alone overstate the importance of the most numerous sectors.

Section 5: Distribution by shareholders

The defining feature of the S corporation population is how small and closely held it is. For TY2013, SOI tabulated S corporations by number of shareholders.

Table 5.1 S corporations by number of shareholders, TY2013

Source: IRS SOI, Table 6, S Corporation Returns by Number of Shareholders, TY2013. Shares derived; categories above 10 shareholders are a small residual not shown here. Total shareholders across all S corporations were 7,074,711 in TY2013.

Single-shareholder S corporations were 63.4% of all S corporations in TY2013, and firms with one or two shareholders together were 90.5%. This concentration in one- and two-owner firms is the structural reason the reasonable-compensation question matters: in a single-shareholder S corporation, the owner sets both the wage (subject to payroll tax) and the distribution (not subject to payroll tax).

Section 6: The wage-versus-distribution dynamic, on the record

S corporation shareholders who work in the business must be paid “reasonable compensation” as wages, which carries Social Security and Medicare (FICA) tax. Profit distributed beyond reasonable wages passes through to the shareholder’s individual return free of payroll tax. The incentive to classify compensation as distribution rather than wage is structural, and the IRS litigates it.

IRS aggregate data documents the magnitude two ways.

First, the scale of wages actually paid. For TY2013, S corporations deducted $254.0 billion in compensation of officers and $730.3 billion in salaries and wages, against $446.2 billion in total net income (less deficit) (IRS SOI, Table 1 and Table 6, Form 1120-S, TY2013). Officer compensation alone equaled about 57% of net income that year, so S corporations as a group do pay substantial owner wages; the compliance concern is concentrated at the margin, not across the whole population.

Second, the estimated underpayment. The Government Accountability Office analyzed IRS National Research Program audit data and found that about 13% of S corporations paid inadequate wage compensation in tax years 2003-2004, with net underpaid wages of just over $23.6 billion (GAO-10-195, December 2009). GAO found single-shareholder S corporations accounted for most of the underpayment ($14.2 billion), and firms with 2 to 3 shareholders for $8.3 billion, so 1-to-3-shareholder firms accounted for almost all of it. Applying the 15.3% FICA rate as an illustration, GAO estimated roughly $3 billion in employment-tax revenue loss over the two years. The median per-return adjustment for underpaid shareholder compensation was $20,127 (GAO-10-195, December 2009).

Limitation. The GAO underpayment estimate rests on NRP data for TY2003-2004. The IRS has not published a comparable, more recent aggregate estimate of S corporation wage underpayment. The figure is the best primary-source quantification available, but it is more than two decades old and should be cited as such.

Original synthesis: three derived insights

These are calculated from the verified source figures above. Each states its formula, inputs, and limitations.

Insight 1: The S-to-C ratio has roughly tripled and keeps rising

Formula. Active S corporation returns divided by active C corporation returns, by tax year (SOI), with a parallel filings ratio from the Data Book.

Result. Active S-to-C ratio: TY1997 the ratio first crossed 1.0 (2,452,254 / 2,248,065 = 1.09); by TY2022 it was 3.48 (5,266,702 / 1,514,763). On a Data Book filings basis, FY2024 shows 2.70 (6,080,370 / 2,252,027).

Inputs. IRS SOI Integrated Business Data 1980-2015; IRS SOI Publication 16 TY2022 Figure G; IRS Data Book FY2024 Table 2.

Limitation. Active-return and filing-count series are not identical; the two ratios are reported separately and should not be mixed. The crossover year is approximate to within one tax year because of sample variability.

Insight 2: Net income per S corporation peaked before recovering, and remains modest

Formula. Total net income (less deficit) divided by number of returns, by tax year, from the SOI Integrated Business Data series.

Result. Average net income per S corporation return rose from about $10,000 in TY1986 ($8.293 billion / 826,214) to a TY2007 cyclical peak, fell sharply in the recession (TY2009: $272.5 billion / 4,094,562 = about $66,500), and recovered to about $104,790 by TY2013. The S corporation is, on average, a small business: the median is far below the mean because a long tail of large firms pulls the average up.

Inputs. IRS SOI Integrated Business Data 1980-2015; IRS SOI Table 6 TY2013.

Limitation. SOI publishes means, not medians, in this series, so the average overstates the typical firm. Net income definitions shifted slightly across decades (trade-or-business net income vs total net income including portfolio and rental); the per-return figures use total net income less deficit as published.

Insight 3: Owner-concentration explains where the reasonable-compensation risk sits

Formula. Cross the shareholder-count distribution (Section 5) against GAO’s finding on which firms drive wage underpayment (Section 6).

Result. 63.4% of S corporations had a single shareholder in TY2013, and 90.5% had one or two. GAO found 1-to-3-shareholder firms accounted for almost all of the $23.6 billion net wage underpayment in TY2003-2004. The overlap means the compliance exposure is concentrated in exactly the most numerous segment of the population: the closely held, owner-operated S corporation where the same person sets both wage and distribution.

Inputs. IRS SOI Table 6 TY2013; GAO-10-195 (December 2009).

Limitation. The shareholder distribution (TY2013) and the underpayment study (TY2003-2004) are from different periods. The inference about where risk sits is directional, not a current dollar estimate. No newer IRS aggregate exists to update the underpayment figure.

Charts to create

1. S corporation returns, 1980-2024 (line chart). Data: return counts from Table 2.1 plus Data Book FY2023-FY2024. Source: IRS SOI Integrated Business Data and IRS Data Book. Insight: the post-1986 inflection and steady climb to 6 million. Citation-worthy because it visualizes the single clearest fact about S corporations in one image.
2. S corporations vs C corporations, active returns, 1980-2022 (two-line crossover chart). Data: S and C columns from Table 2.1. Source: IRS SOI Integrated Business Data; Publication 16 TY2022. Insight: the TY1997 crossover and the widening gap. Citation-worthy because the crossover is frequently asserted without a sourced chart.
3. S corporation net income (less deficit), 1986-2022 (line chart with recession shading). Data: Table 2.1 net income column plus $763.3 billion for TY2022. Source: IRS SOI. Insight: counts kept rising while profits cycled, especially 2008-2009.
4. S corporations by industry, TY2013 (bar chart, returns and net income side by side). Data: Table 4.1. Source: IRS SOI Table 1, TY2013. Insight: the gap between where firms cluster (construction, professional services) and where profit concentrates (manufacturing, management of companies).
5. Shareholder concentration, TY2013 (stacked bar or pie). Data: Table 5.1. Source: IRS SOI Table 6, TY2013. Insight: 63.4% single-shareholder, the structural backdrop to the reasonable-compensation question.

Methodology

Source selection. Only Tier-1 primary sources were used for quantitative claims: IRS Statistics of Income (Publication 16 Complete Report, the Integrated Business Data series, and the Form 1120-S basic tables), the IRS Data Book (Publication 55-B), and the Government Accountability Office. Secondary commentary was used only to locate primary documents, not as a source of figures.

Inclusion and exclusion. A figure was included only if it appeared in an IRS or GAO primary document with an identifiable tax year or fiscal year. Figures that could not be tied to a specific published year were excluded. No projections, no inflation adjustments, and no figures presented as “current” when the underlying data lags.

Handling the two count series. The IRS Data Book (returns filed in a fiscal year) and SOI Complete Report (active corporations in a tax year) are reported as separate series and never blended. Where both exist, both are shown.

Derived figures. Three derived calculations (S-to-C ratio, net income per return, and the shareholder-concentration overlap) are clearly labeled with formula and inputs in the Original Synthesis section. Percentage shares in the tables are derived from published counts and noted as such.

Currency of data. SOI corporation data lags one to three years. As of 2026-06-29, the most recent aggregate S corporation net income is TY2022 (Publication 16, released September 2025); the most recent full S-corporation sector and shareholder breakdown is TY2013; the most recent filing count is FY2024 (Data Book). The reasonable-compensation underpayment estimate is from TY2003-2004 NRP data and has not been updated by a comparable IRS aggregate.

Date of last update. 2026-06-29.

Source quality ranking

Tier 1 (primary government and oversight):
– IRS Statistics of Income, Corporation Income Tax Returns Complete Report, Publication 16, TY2022 (released September 2025). Active return counts (Figure G), aggregate net income, asset-size distribution.
– IRS Statistics of Income, Integrated Business Data, “Selected financial data on businesses by form of business and tax year, 1980-2015.” The long historical time series of returns and net income by entity type.
– IRS Statistics of Income, Form 1120-S basic tables (Table 6 by number of shareholders; Table 1 by major industry), TY2013. Shareholder distribution, industry distribution, officer compensation and wages.
– IRS Data Book, Publication 55-B, FY2024, Table 2 (Number of Returns and Other Forms Filed, by Type). Filing counts FY2023-FY2024.
– IRS Statistics of Income, “S Corporation Returns, 2003” (Kelly Luttrell). Historical growth narrative and TY2003 shares.
– U.S. Government Accountability Office, GAO-10-195, “Tax Gap: Actions Needed to Address Noncompliance with S Corporation Tax Rules” (December 2009). Wage underpayment analysis from NRP data.

Tier 2 / Tier 3: None used for figures. Secondary tax-press and academic items surfaced during research were used only to locate the Tier-1 documents above and are not cited for any statistic.

Excluded and why: Any state-by-state S corporation count was excluded because SOI does not publish S corporations by state; circulating state tables are not IRS SOI products. Newer “estimated S corporation underpayment” figures from non-government sources were excluded because they are not IRS or GAO aggregates. Pre-1980 S corporation counts were excluded for lack of a consistent published series in the sources fetched.

Citation format

• Source: IRS, Statistics of Income Division, Corporation Income Tax Returns Complete Report (Publication 16), Tax Year 2022, September 2025.
• Source: IRS, Statistics of Income, Integrated Business Data, Selected Financial Data by Form of Business and Tax Year, 1980-2015.
• Source: IRS, Statistics of Income, S Corporation Returns (Form 1120-S), Table 6 (by number of shareholders) and Table 1 (by major industry), Tax Year 2013.
• Source: IRS Data Book, Fiscal Year 2024 (Publication 55-B), Table 2, Number of Returns and Other Forms Filed, by Type.
• Source: IRS, Statistics of Income Bulletin, "S Corporation Returns, 2003," by Kelly Luttrell.
• Source: U.S. Government Accountability Office, GAO-10-195, "Tax Gap: Actions Needed to Address Noncompliance with S Corporation Tax Rules," December 2009.

Journalist-friendly additions

Most quotable statistics

• The IRS received 6,080,370 S corporation returns in FY2024, up 3.4% year over year (IRS Data Book, FY2024).
• S corporations were 76.9% of all active corporations for TY2022 (IRS SOI, Publication 16, TY2022).
• S corporations reported $763.3 billion in pretax profits for TY2022 (IRS SOI, Publication 16, TY2022).
• The S corporation count grew about 537% from TY1986 to TY2022 (IRS SOI).
• 63.4% of S corporations had a single shareholder in TY2013 (IRS SOI, Table 6, TY2013).
• About 13% of S corporations paid inadequate wages in TY2003-2004, totaling $23.6 billion in underpaid compensation (GAO-10-195, 2009).

Data limitations

SOI corporation data lags one to three years; the most recent aggregate net income is TY2022. The most recent full S-corporation industry and shareholder breakdown is TY2013. The Data Book counts filings in a fiscal year, which differs from the SOI active-return tax-year estimate. SOI does not publish S corporations by state. The wage-underpayment estimate is from TY2003-2004 and has not been refreshed.

Downloadable dataset, recommended fields

tax_year, series_type (data_book_filings | soi_active_returns | soi_integrated_business), entity_type (s_corp | c_corp | total_corp), number_of_returns, total_net_income_less_deficit_usd000, net_income_trade_business_usd000, total_receipts_usd000, total_assets_usd000, industry_naics_sector, number_of_shareholders_band, source_publication, source_url, release_date, notes.

Press summary (about 150 words)

The S corporation is now the dominant corporate form in the United States. The IRS received 6,080,370 Form 1120-S returns in fiscal year 2024, up 3.4% from the prior year and roughly 2.7 times the number of C and other corporation returns, according to the IRS Data Book. By tax year, IRS Statistics of Income estimated 5,266,702 active S corporations for 2022, 76.9% of all active corporations, reporting $763.3 billion in pretax profits. The population traces a clear arc from the 1986 Tax Reform Act: S corporation returns grew about 537% between 1986 and 2022 and overtook C corporations in number around 1997. The firms are overwhelmingly small and closely held: 63.4% had a single shareholder in 2013. That concentration frames the reasonable-compensation debate, where a 2009 GAO study found 13% of S corporations underpaid wages by $23.6 billion over 2003-2004.

Suggested headlines

1. S Corporations Hit 6.08 Million Returns in 2024, Now Outnumber C Corporations Nearly 3 to 1
2. The S Corporation Boom: 537% Growth Since the 1986 Tax Reform
3. 76.9% of U.S. Corporations Are S Corporations, IRS Data Shows
4. Single-Owner Firms Dominate: 63% of S Corporations Have One Shareholder
5. The $23.6 Billion Question: What IRS Data Says About S Corporation Wages

FAQ

1. How many S corporations are there in the United States? The IRS received 6,080,370 Form 1120-S returns in FY2024 (IRS Data Book, FY2024). SOI estimated 5,266,702 active S corporations for TY2022 (Publication 16).
2. Are there more S corporations or C corporations? More S corporations. In FY2024, S corporation filings (6,080,370) were about 2.7 times C and other corporation filings (2,252,027) (IRS Data Book, FY2024).
3. When did S corporations overtake C corporations? Around TY1997, when active S corporation returns (2,452,254) first exceeded C corporation returns (2,248,065) (IRS SOI Integrated Business Data).
4. What share of all corporations are S corporations? 76.9% of active corporations for TY2022 (IRS SOI, Publication 16).
5. How much net income do S corporations report? $763.3 billion in pretax profits for TY2022 (IRS SOI, Publication 16).
6. What is the average S corporation’s net income? About $104,790 per return in TY2013 (IRS SOI, Table 6); SOI reports means, not medians.
7. Which industries have the most S corporations? Professional/scientific/technical services, wholesale and retail trade, and construction led in TY2013 (IRS SOI, Table 1).
8. How many shareholders does a typical S corporation have? 63.4% had a single shareholder in TY2013, and 90.5% had one or two (IRS SOI, Table 6).
9. Why did S corporations grow so fast after 1986? The 1986 Tax Reform Act and later acts in 1990, 1993, and 1996 made pass-through treatment more attractive; SOI measured 8.8% average annual growth through TY2003 (IRS SOI, “S Corporation Returns, 2003”).
10. Do S corporations underpay wages to avoid payroll tax? A 2009 GAO study found about 13% of S corporations paid inadequate wages in TY2003-2004, totaling $23.6 billion, concentrated in 1-to-3-shareholder firms (GAO-10-195). No comparable newer IRS aggregate exists.

Sources

1. IRS, Statistics of Income, Corporation Income Tax Returns Complete Report (Publication 16), Tax Year 2022 (released September 2025). https://www.irs.gov/pub/irs-pdf/p16.pdf
2. IRS, Statistics of Income, Integrated Business Data, Selected Financial Data on Businesses by Form of Business and Tax Year, 1980-2015. https://www.irs.gov/statistics/soi-tax-stats-integrated-business-data (data file: https://www.irs.gov/pub/irs-soi/15otidb1.xls)
3. IRS, Statistics of Income, S Corporation Returns (Form 1120-S), Table 6 by number of shareholders, Tax Year 2013. https://www.irs.gov/statistics/soi-tax-stats-table-6-returns-of-active-corporations-form-1120-s (data file: https://www.irs.gov/pub/irs-soi/13co06s.xls)
4. IRS, Statistics of Income, S Corporations: Total Receipts and Deductions by Major Industry, Table 1, Form 1120-S, Tax Year 2013. https://www.irs.gov/statistics/soi-tax-stats-table-1-returns-of-active-corporations-form-1120s (data file: https://www.irs.gov/pub/irs-soi/13co01s.xls)
5. IRS Data Book, Fiscal Year 2024 (Publication 55-B), Table 2, Number of Returns and Other Forms Filed, by Type. https://www.irs.gov/statistics/returns-filed-taxes-collected-and-refunds-issued (current Data Book: https://www.irs.gov/pub/irs-pdf/p55b.pdf)
6. IRS, Statistics of Income Bulletin, “S Corporation Returns, 2003,” by Kelly Luttrell. https://www.irs.gov/pub/irs-soi/03scorp.pdf
7. U.S. Government Accountability Office, GAO-10-195, “Tax Gap: Actions Needed to Address Noncompliance with S Corporation Tax Rules,” December 2009. https://www.gao.gov/products/gao-10-195 (full text: https://www.gao.gov/assets/a299526.html)
8. IRS, SOI Tax Stats, S Corporation Statistics (program overview and basic tables index). https://www.irs.gov/statistics/soi-tax-stats-s-corporation-statistics

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