Form 1120‑S is the IRS income tax return used by S corporations to report the business’s income, deductions, and credits for the year. It calculates the company’s profit or loss, which then flows through to the personal tax returns of the business owners (shareholders) via Schedules K‑1.

Who typically files Form 1120‑S

Form 1120‑S is used when a business has elected to be taxed as an S-corporation.

Owners commonly file Form 1120‑S when:

• The business is an incorporated entity (or LLC) that has made a valid S-corporation election with the IRS.
• The business has one or more owners who receive a Schedule K‑1 showing their share of the company’s income, deductions, and credits.

Other business structures usually file different returns:

• Sole proprietorships and single‑member LLCs that have not elected corporate taxation typically report business activity on Schedule C with Form 1040.
• Partnerships and multi‑member LLCs taxed as partnerships typically file Form 1065 and provide each owner with a Schedule K‑1.
• C-corporations typically file Form 1120.

If you are not sure whether your business should be filing Form 1120‑S, a certified tax professional can help you confirm your tax classification and filing requirements.

How Form 1120‑S works with your taxes

Form 1120‑S is filed at the business level, but the tax impact is passed through to the individual owners.

At a high level:

• The S corporation reports gross receipts, returns and allowances, and other business income on Form 1120‑S.
• It subtracts deductible business expenses (such as salaries, rent, professional fees, and other operating costs) to determine ordinary business income or loss.
• The form also captures other items like credits, separately stated income or deductions, and balance sheet information.
• Each owner receives a Schedule K‑1 that shows their share of the company’s income, losses, deductions, and credits.

Owners then use information from the Schedule K‑1 to complete their personal tax returns. The S-corporation itself usually does not pay federal income tax on this income; instead, tax is calculated at the owner level.

What Lili’s Form 1120‑S includes

For eligible account plans, Lili generates a Form 1120‑S support package using the income and expense activity that has been categorized in your account.

The Lili‑generated 1120‑S report includes:

• Business information such as legal name, EIN, and tax year, based on your profile.
• Total business income for the year, based on deposits and categorized income in your Lili account.
• Business expenses grouped into categories aligned with how they are reported on Form 1120‑S.
• A calculated ordinary business profit or loss figure derived from your categorized transactions.

If there are uncategorized transactions for the selected period, you’ll be prompted to categorize them so they can be reflected correctly in your 1120‑S support report.

Note: Lili does not replace your tax preparer or the IRS forms themselves. Instead, we provide a structured report that you and your accountant can use to complete Form 1120‑S accurately and efficiently.

Who can generate a Form 1120‑S with Lili

Lili Smart and Lili Premium account plans include access to advanced business tax reports, including support for Form 1120‑S. If your business is taxed as an S-corporation and you received business deposits in the prior year, you can request an 1120‑S support report for that tax year directly in your Lili account.

If your business is taxed differently (for example, as a partnership or a sole proprietorship), you may instead use Lili to generate reports aligned with Form 1065 or Schedule C, depending on your setup.

How to create a Form 1120‑S report in the Lili Web App

To request or create your Form 1120‑S support report in the Web App:

1. Go to the Main Menu at the top left of your dashboard.
2. Select Reports & Statements.
3. Choose Form 1120‑S and select the tax year you need.
4. Review the disclaimer and select GET STARTED.
5. If prompted, categorize any remaining uncategorized income or expenses for that year so they are included correctly.
6. Follow any additional on‑screen instructions to generate your 1120‑S support report.

Once your report is generated, you can:

• Click on the desired year to open it.
• Use the options at the top right of the preview to Print or Download PDF.

How to create a Form 1120‑S report in the Lili Mobile App

To request or create your Form 1120‑S support report in the Mobile App:

1. Open the main menu and tap Reports.
2. Select Form 1120‑S and choose the relevant year.
3. Read the disclaimer and tap GET STARTED if prompted.
4. Categorize any remaining uncategorized transactions for that year so the report is complete.
5. After the report is generated, you’ll see a preview. Use the options above the preview to Share the document through your device’s native sharing tools.

How to use your Lili 1120‑S report

Your Lili‑generated 1120‑S support report is designed to give you and your tax professional a clear, organized starting point built from your actual business activity.

You can:

• Download the PDF and provide it to your accountant or tax preparer as the basis for completing Form 1120‑S and your owners’ Schedules K‑1.
• Use the figures in the report when preparing your own return with tax software, making sure all income and expenses from your Lili account are included and properly classified.

All amounts in the report are based on the information in your Lili account, including how you or your team have categorized transactions. You should always review the report carefully and consult a qualified tax professional before filing Form 1120‑S.

Here’s what a Lili‑generated Form 1120-s looks like

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