The Upcoming Battle for the American Soul

[TheOne]

explain this. - well the basic understanding I have of S-Corps is that you don't take a salary. All of the business profits, minus expenses (including re-investment), flow through to the owners as salary and are taxed as personal income.

you either take a salary or you don't. do YOU understand business?

You said this:

As I said, if you pay yourself $50,000, make profit of $150,000 then you are taxed at $200K.

You don't pay yourself in an S Corp. All of your profits are your pay. Therefore, the $150K you reinvested is not taxed because it's not profits. You know nothing...it is evident.

As for SS, Medicare, you do pay that on the profit you decided to keep. Not your salary. It's called self-employment tax.

 

[MtnBiker]

TheOne, you need to get your quotes straight. You made claim that DK said this:

As I said, if you pay yourself $50,000, make profit of $150,000 then you are taxed at $200K.

He did not say that another member did. You really should be more carefull especially when you claim that it is evident that someone knows nothing.

 

[freeandfun1]

You said this:



You don't pay yourself in an S Corp. All of your profits are your pay. Therefore, the $150K you reinvested is not taxed because it's not profits. You know nothing...it is evident.

As for SS, Medicare, you do pay that on the profit you decided to keep. Not your salary. It's called self-employment tax.

Dude, you are soooooo stupid you know not what you are talking about.
Self-employment taxes do not apply to S corporations. Self-employment taxes, apply to sole proprietors and 1099 employees.

Take a look at this link:

Self Employment Tax

When you start a small business and you do not incorporate or form a partnership, you report the results of your operations on Schedule C of Form 1040 You report your gross revenue, and detail your expenses. The result of netting your revenues and expenses is a net profit or loss. (Article 7) and IRS Publication 334: Tax Guide for Small Business.

"S" corporations are, well, you guess it, CORPORATIONS!

here is another link:

If the taxpayer is self-employed, the taxpayer can substantially increase his after-tax cash flow by incorporating and electing to be taxed as an S Corporation. While the owner continues to be subject to income tax, he is no longer subject to self-employment tax or social security tax. The taxpayer can then apply this tax savings to the payment of old taxes.

FINDLAW.COM

 

[freeandfun1]

Gotcha!

 

[mainecoons0]

Have three corporations, one S corp, one limited partnership and one LLC. Haven't paid myself a salary in years. Since 1981, actually. Take out everything as dividends. SS is a rat hole. Instead of wasting money on that, I've invested and have a nice 7 figure net worth. Don't expect to collect much SS and don't give a damn.

Lefties, do you understand what a Ponzi scheme is? If not, look it up. SS is a Ponzi scheme. When the baby boom hits it, the jig is up.

 

[Annie]

Have three corporations, one S corp, one limited partnership and one LLC. Haven't paid myself a salary in years. Since 1981, actually. Take out everything as dividends. SS is a rat hole. Instead of wasting money on that, I've invested and have a nice 7 figure net worth. Don't expect to collect much SS and don't give a damn.

Lefties, do you understand what a Ponzi scheme is? If not, look it up. SS is a Ponzi scheme. When the baby boom hits it, the jig is up.

Welcome Maincoons0! I do believe you posted something worthwhile there, but I am personally clueless! But others should be answering shortly I'd imagine.

 

[freeandfun1]

Have three corporations, one S corp, one limited partnership and one LLC. Haven't paid myself a salary in years. Since 1981, actually. Take out everything as dividends. SS is a rat hole. Instead of wasting money on that, I've invested and have a nice 7 figure net worth. Don't expect to collect much SS and don't give a damn.

Lefties, do you understand what a Ponzi scheme is? If not, look it up. SS is a Ponzi scheme. When the baby boom hits it, the jig is up.

Well, I honestly commend your bravery, but I ain't gonna chance it myself. I do take the "bulk" of my income as dividends, but I do also pay myself a commensurable salary based on my roll in the company and the profits generated. Perhaps if I were older or just less scared I would chance it, but I ain't look'n to git'n the IRS on my ass any time soon.

Good luck!

 

[freeandfun1]

And welcome too!

 

[insein]

Well, I honestly commend your bravery, but I ain't gonna chance it myself. I do take the "bulk" of my income as dividends, but I do also pay myself a commensurable salary based on my roll in the company and the profits generated. Perhaps if I were older or just less scared I would chance it, but I ain't look'n to git'n the IRS on my ass any time soon.

Good luck!

Perhaps soon the IRS won't be around to get you.

http://www.usmessageboard.com/forums/showthread.php?t=9819