But if you show your client how to use an s corporation to minimize her employment tax youll put cash in her pocket right now if you show her how to use a section 105 plan to write off her lasik surgery as a business expense youll put cash in her pocket. To protect what you have its vital to take some defensive measures to make it more difficult for creditors to seize your assets in the event you lose a lawsuit have a judgment entered against you or are forced into bankruptcy. The c corporation sells the property and realizes a gain of 10000 the corporations income tax rate is 15 percent result corporate income tax is 1500 15 percent x 10000 the c corporation pays you a dividend of 8500 the gain of 10000 minus the 1500 in taxes your personal tax rate is also 15 percent. An s corporation is a small corporation that passes through gains and losses directly to its employees many s corporations have only the owner as a shareholder and in no case can they exceed 99 employees. Our corporation setup for you allows your corporation to borrow or lend money to any individual or entity including officers directors and shareholders of the company this is one way to take money out of your corporation without incurring a taxable event
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