Content Are Non-U.S. Residents Allowed to Own a Corporation or LLC? Step 2. Appoint a registered agent Additional Steps on How to Form an S Corp Step 4. Create an operating agreement Advantages of S Corps LLC vs. S Corporation: An Overview Understanding S corporations and payroll Generally, California law follows federal law in computing the S corporation’s income. However, the major difference is that for California purposes, an S corporation’s income is taxable at