Every S corporation faces the same recurring tasks: Form 1120-S, Schedule K-1s, reasonable shareholder compensation, payroll reporting, bookkeeping and state filings. A $170 software licence covers only part of that list.
This guide compares five routes, from DIY software to outsourced U.S. compliance support. Australian readers get an extra note: confirm your U.S. eligibility and your Australian reporting duties separately.
Key Takeaways
- S corporation status is a U.S. tax classification, so software or preparers must explicitly support Form 1120-S.
- Federal preparation, state returns, K-1s, payroll and bookkeeping are usually priced separately.
- Compare total compliance cost and risk, not the headline fee.
- Australian individual returns differ from U.S. S corporation filings and must be handled separately.
Overview of S Corp Tax Filing Costs for Small Businesses
An S corporation passes income, losses, deductions and credits through to shareholders for federal tax purposes. It still files Form 1120-S and issues a Schedule K-1 to each shareholder.
What the fee may not cover
Preparing the return is only one cost. Others include:
- Shareholder basis records
- Reasonable compensation analysis, since the IRS can reclassify distributions as wages
- Payroll filings (Forms 941, 940 and W-2)
- Bookkeeping or clean-up
- State filings
- Separate individual or cross-border returns
Late filing is expensive too. For returns due in 2026, the penalty is $255 per shareholder per month, up to 12 months. A cheap provider that files late erases any savings.
Australian readers: check eligibility first
Living in Australia does not bar you from owning S corporation shares. A U.S. citizen abroad is not a nonresident alien. Key limits still apply:
- A nonresident alien cannot hold shares directly
- Maximum of 100 shareholders
- Only one class of stock
Australian tax residents generally declare foreign income to the ATO. Controlled foreign company rules may also apply in some cases. Get cross-border advice before choosing a filing method.
Cheapest S Corp Tax Filing Options for Small Businesses
Judge each route on:
- Lowest realistic total cost
- Form 1120-S capability
- Transparency
- Support level
- Compliance risk
- Fit for an Australian-based owner managing U.S. obligations
DIY business tax software
Published 2026 prices:
| Product | Federal price | Notes |
|---|---|---|
| TaxAct Business Online | $169.99 | 1120-S and K-1 wizard; state fee listed as $69.99 or $59.99 on different pages |
| TurboTax Desktop Business 2025 | $190 | 5 federal e-files; state download separate |
| H&R Block Premium & Business | $100 promo / $115 list | Preorder; business state e-file $19.95 in listed states |
This route suits a single-shareholder company with clean books, simple transactions and one state. You do the technical work.
Check add-ons, state charges, support upgrades and your own time. Skip DIY if you have multiple states, inventory, depreciation complexity, prior-year errors or Australian ownership questions. FreeTaxUSA lists entering K-1 income, not preparing a corporation's 1120-S.
Flat-fee online S Corp preparation
Remote services offer fixed pricing without a local office. Fixed-price examples include:
- Block Advisors: from $280
- Greenback: $750 for a package including Form 1120-S, with up to two partners and $90 per additional partner
- Taxfyle: lists S corporation preparation and K-1s, but no public base price
A flat fee helps budgeting. Ask whether the quote includes K-1s, state returns, compensation review, extensions, notices and amendments. Also compare turnaround, preparer credentials, data security and post-filing support.
Enrolled Agent or experienced S Corp preparer
Enrolled agents are IRS-credentialed practitioners who complete a three-part exam and 72 hours of continuing education every three years. A PTIN alone proves nothing about expertise. The IRS directory helps verify credentials.
An EA suits a small, uncomplicated S corporation that wants human support but not year-round advisory. Verify recent Form 1120-S experience rather than trusting a low rate.
Ask whether the fee covers:
- Federal and state filings
- K-1 preparation and basis review
- Payroll coordination
- Estimated tax guidance
- Extensions and notices
Small CPA firm specialising in S corporations
A specialist CPA costs more than software. In return you get help with reasonable compensation, distributions, deductions, basis and multi-state compliance.
The NSA 2023 survey put the average federal 1120-S fee at $970. It is a historical benchmark, not a current quote, and not state-inclusive.
Compare credentials, S corporation client experience, engagement scope, secure document exchange and availability outside filing season. Weigh compliance-only pricing against planning or bookkeeping bundles. Advice that prevents an amended return or penalty can pay for itself.
Outsourced U.S. tax-compliance and accounting provider
Outsourced providers can combine bookkeeping, payroll coordination, reporting and U.S. tax compliance. This suits recurring needs or cross-border operations.
Collective, for example, lists an S Corp plan at $349 per month with annual 1120-S included, plus bookkeeping and member payroll. That is a bundle, not a standalone filing fee.
Check U.S. tax expertise, review procedures, confidentiality, communication hours and who is responsible for final filings. IRS Section 7216 guidance requires taxpayer consent before return information goes to a preparer outside the United States.
Australian owners should also account for currency and fees. One CommBank notice lists a 3.5% international transaction fee on certain cards.
GST registration applies at A$75,000 turnover. Reverse-charge rules may apply to offshore services for registered businesses that cannot claim full credits.
How We Chose the Best S Corp Tax Filing Options
We ranked each option on total cost, filing capability, transparency and compliance support, not the lowest advertised price. The common mistake is comparing an all-in quote with a filing-only price.
Five factors drove the ranking:
- Scope of work: Form 1120-S, K-1s, federal and state e-filing, basis support, payroll coordination, extensions, amendments and notices.
- Business complexity: shareholder count, state nexus, transaction volume, depreciation, inventory, foreign ownership issues, prior-year errors and book condition.
- Pricing transparency: written quotes with separate lines for add-ons, hourly work, rush fees, state filings, bookkeeping, payroll and advisory time.
- Expertise: S corporation experience, professional status, quality control and support for Australian owners.
- Ongoing value: turnaround, data security, notice assistance, year-round planning and the cost of switching later.
Conclusion
The cheapest S Corp option is the one that matches your real complexity and gets every required filing right. The smallest initial price often is not.
Compare written quotes, confirm exclusions, keep books and payroll records current, and reassess as you add shareholders or states.
If you need cost-effective outsourced accounting or tax-compliance support, contact VJM Global for a scope-based discussion and transparent quote. VJM Global's U.S. capability lists corporate returns including Form 1120-S, with pricing quoted per state and entity structure.
Frequently Asked Questions
How much does ITR filing cost?
"ITR" generally means an individual income tax return, separate from Form 1120-S. In Australia, myTax is free, and H&R Block Australia advertises starting prices of AUD109 and AUD179. Cost rises with income sources and complexity.
What is the cheapest way to file an S Corp tax return?
DIY software is usually cheapest, but only for simple returns where the owner can handle compliance work. Low-cost professional preparation costs more and reduces error risk.
How much does an S Corp tax return cost for a small business?
Offers typically run from $169.99 (software) and $280 (online preparation) to $750 (package), with a $970 survey average for CPAs and EAs. Shareholders, states, bookkeeping and payroll change the total.
Can I use tax software to file Form 1120-S myself?
Yes, if the product specifically supports Form 1120-S and its schedules. Confirm federal, state, K-1, e-filing and support features for the correct tax year before buying.
What is included in a low-cost S Corp tax filing service?
It may cover the federal return and K-1s. State returns, payroll, extensions, amendments, bookkeeping and notice support are often extra. Ask for a written scope.
Can an Australian resident own an S corporation?
Possibly. Eligibility depends on the shareholder's U.S. status, such as citizenship, green card or substantial presence, and the corporation's ownership rules. Check current IRS requirements and get U.S.-Australian tax advice.
