Quote:
Originally Posted by JA$ON
100% of the s-corps profits or losses get passed through to the owners of the s-corps stock. While still "income", you'll save the Social security, medicare etc on the portion that you take as a distribution.
Call a cpa. While there are benifits to an S-corp vs an LLC, an s-corp requires far more paperwork (keeping of minutes, the taxes need to be paid on the salry you takes etc)
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what he said...
the reason S-corp owners pay themselves a salary is because so many real estate agents for years did not (and didnt pay social security taxes), the IRS got on their case and now is better to pay yourself a small salary and pay employer ss taxes on that income and not on the entire s corp income.
in a c corp you can leave the money in the corp and only take out what you want, but you would pay tax twice, first the c corp would pay tax on its profit, then whatever dividend you give yourself, you'd be paying income tax.. good for uncle sam !
as i understand LLC are better for "investment partnerships" or shorter termed ventures..
dont go cheap, get real advise from a CPA.