Incorporate Your Business?
• We’ll advise you of the pluses and minuses of incorporating.
• We’ll assess how different features of a corporation meet your criteria for liability protection, income tax savings, self-employment taxes, double taxation, timing, and other factors.
• Protect your personal assets from liabilities arising out of your business problems.
• Protect your business from liabilities arising out of your personal problems
• Avoid Schedule C for sole proprietorships - a major cause of IRS audits.
• Avoid double taxation by converting to “S” corporate status.
• Read A-Z Tax Tips for more information on corporations.
• Limited Liability Companies have become the choice of entity for protecting rentals.
• LLCs are also ideal entities to protect stocks, land, and other investments.
• LLCs are flexible - you can choose to be taxed as corporation, partnership, or disregarded entity.
• Avoid filing corporate or partnership income tax returns by electing to be taxed as disregarded.
• Read more about LLCs in A-Z Tax Tips.
• Regulations require that you withhold income taxes, SS, and SDI from employees’ paychecks.
• Tempted to withhold nothing from workers’ paychecks? This is dangerous.
• Short of cash to pay for other critical business expenses? Don’t use withheld payroll taxes.
• Employers attempt to save payroll taxes by treating workers as independent contractors.
• So then, is it safe to treat workers as independent contractors?
• Learn when to treat workers as employees on W2s or as independent contractors on 1099.
• Plan early for IRS and EDD audits - learn where landmines are.
• Learn how to protect your company and yourself from worker reclassification audits.
• Learn how to use CUIC 687.2 for caregivers.
• Learn what tests are used by the IRS and EDD in determining worker status.
• When do you buy or lease a vehicle?
• Consider car reliability, miles that you drive, cash down payment, and tax implications.
• New clients come to me for advice after they encounter problems.
• How about getting advice before getting into a potentially risky situation?
• Identify options and the benefits and hazards of each option
• Save taxes and fees by tax planning.
• What does the “S” mean in S corporations?
• Why are S corporations popular among entrepreneurs?
• Corporations provide liability protection as separate entities.
• Regular corporations also pay corporate-level taxes.
• You also pay personal taxes double taxation.
• Avoid double taxation by electing not to pay corporate federal income taxes with an S election.
• In other words, you elect not to pay any federal corporate income tax.
• As a bonus, pay no self-employment taxes (social security and FICA) on corporate net income.
• Avoid high PSC taxes if your corporation is classified as a personal service corporation (PSC).
• PSCs include doctors, lawyers, certified public accountants, architects and others who are required to pay a high flat 35% instead of enjoying lower graduated tax rates.
• Read A-Z Tax Tips for more information on this subject.
• LLCs that are taxed as corporations and partnerships file forms 1120, 1120S, or 1065.
• They are also required to keep track of assets and liabilities.
• Save accounting fees by electing to file as disregarded entity.
• Elect to report rental properties directly into Schedule E of your personal income tax.