Yes. A business can become an S-Corporation by complying with South Dakota's incorporation laws and then electing (by completing Form 2553 to the IRS) to pass corporate income, losses, deductions and credits through to its owners (shareholders) for federal tax purposes.
An S-Corporation owner reports the income and losses on his personal tax returns and is assessed tax at his individual income tax rate. Therefore, the S-Corporation avoids double taxation on the corporate income.
