S Corporation status gives you the liability protection of a corporation, and allows you to pay taxes on the same basis as a sole proprietor or partnership, that means you pay tax at the personal rate and your profits are your salary.More >>
Monday, May 13 2013 12:24 PM EDT2013-05-13 16:24:04 GMT
MARION COUNTY, MS (WDAM) - A weekend-long drug raid left 22 individuals behind bars, and more arrests to come. According to Marion County Sheriff Berkley Hall, the drug raid is the result of severalMore >>
A weekend-long drug raid left 22 individuals behind bars, and more arrests to come.More >>
Saturday, April 19 2014 9:01 PM EDT2014-04-20 01:01:26 GMT
Dozens of Petal residents and members of nearly one dozen Native-American tribes from six Southeastern states are engaging in an exchange of cultures for the first time in the Friendly City this weekend.More >>
Members of the Choctaw, Creek, Cherokee and other tribes are taking part in the 12th annual Golden Eagle Pow Wow.More >>
Saturday, April 19 2014 8:11 PM EDT2014-04-20 00:11:41 GMT
Churches from around the Petal area gathered today for the Community Easter Celebration. Guests from over 18 different church congregations filled the Petal Performing Arts Center to celebrate the trueMore >>
Guests from over 18 different church congregations filled the Petal Performing Arts Center to celebrate the true meaning of Easter with song and praise while listening to scripture reading from several local pastors.
Thursday, April 10 2014 3:13 PM EDT2014-04-10 19:13:00 GMT
A Columbia doctor charged with sexual battery has taken his own life. Dr. Martin Ugwudike was found dead in his home in the Canebrake subdivision near Hattiesburg just before noon. Ugwudike, who hasMore >>
A Columbia doctor charged with sexual battery has taken his own life. More >>
Many small businesses dread it, but your end-of-year reconciliation doesn't need to hurt -- as long as you stay organized.More >>
The main difference between a C Corporation and other business structures is that a C Corporation files and pays corporate income taxes directly. This is because, C Corporations are considered a separate entity from their shareholders, and must pay taxes on income left over after business expenses.
There are a number of instances in which it is beneficial to become a C Corporation. If you plan to keep profits and other chunks of cash in the bank to finance your growth, repay debt, or make other capital expenditures, C Corporation status could make sense. This is because C Corporations can take advantage of corporate income tax rates, which are sometimes lower than personal tax rates. For profitable companies, C Corporation status has the ability provide greater flexibility in terms of planning and controlling federal income taxes. C Corporations also can deduct the cost of certain fringe benefit packages.
If you form a C Corporation, be aware that you run the risk of being taxed twice on your profits - once as a corporation, and a second time as an individual when you dispense those profits as dividends or when you liquidate the corporation. This is one of the major disadvantages of a C Corporation. Let's say, for example, your company has profits of $100,000 for one year. First, the corporation will have to pay tax on it. Then, if you parcel that money out to yourself or other owners, the IRS may treat it as dividends and will tax you as an individual. If you wait until the next year to take all or part of that money as salary, you will already have paid corporate tax on it during the year it was profit, and will then pay tax as an individual when you give it to yourself as salary.
Many tax and financial experts can come up with ways to plan for profits to avoid or limit this type of double taxation. You should speak with your accountant or tax advisor to come up with the most flexible program for your company.
Corporate liability for shareholders
100% deduction of certain benefit packages
Greater flexibility for planning and controlling income taxes
Requires more paperwork and is more expensive than partnership or sole proprietorship
Possible "double taxation" on profits
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