A closely held business corporation which has the ability to make an election to pass corporate income, deductions and losses to shareholders for federal income tax purposes. S Corporations may not have more than 100 shareholders, a shareholder who is not an individual, (special exemptions may apply) or more than one class of stock. As a result, they are not generally viewed as good structures for entrepreneurs seeking to finance their companies with funding from angels, angel groups or venture capital firms.6
