US Company Bookkeeping & Form 1120 / 1120-S Basics

Bottom line

Good bookkeeping connects every bank, card, payroll, inventory, and related-party transaction to a defensible tax return. For a U.S. C-Corp, Form 1120 reporting differs from an S-Corp Form 1120-S; nonresident owners often cannot use S-Corp treatment, so confirm eligibility before assuming it.

Monthly close

Maintain a chart of accounts, reconcile bank and credit-card statements, track receivables/payables, document owner contributions and distributions, and retain invoices. Close monthly so the tax preparer can trace revenue, expenses, fixed assets, payroll, and related-party balances.

Form 1120 vs 1120-S

A C-Corp generally reports on Form 1120. An eligible S-Corp files Form 1120-S and issues Schedule K-1 to shareholders. Entity type, ownership, elections, and nonresident status matter; this is compliance planning, not a guaranteed tax result.

Related-party support

Cross-border parent/subsidiary charges should have agreements, invoices, service descriptions, payment records, and consistent accounting. Keep books in U.S. dollars with a documented exchange-rate method.

Filing timeline

Track the federal due date, state returns, payroll filings, information returns, and extension Form 7004. An extension generally extends filing time, not payment. Reconcile books before filing and retain workpapers.

Self-check

Do you reconcile monthly? Can every large transaction be explained? Are owner and related-party balances documented? Is the entity’s tax classification confirmed? Are state obligations tracked?

What YCL can do

YCL supports Cary/RTP and Shanghai outbound teams with bilingual bookkeeping, monthly close, corporate-return coordination, and a Free Consultation. Rules vary by facts; speak with a licensed professional.

Disclaimer

This is general educational information, not tax or legal advice, and does not promise a filing result, tax savings, or penalty relief. Consult a qualified professional.