S corp

[butterblood]

I know it probably varies from state to state. But can anyone with experience give me the pros and cons of forming an S corp.
My accountant brought it up this week and I'm just trying to get some other peoples opinions.

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[gueuzeman]

Better liability protection. House, retirement accounts, not on the table should you be sued. But don't get caught having the company buy a plasma screen for the living room, then you've opened the door.

Worth it- I'm a C corp, for no apparent reason. In a fellow high tax state like you.

President gueuze- corporate clown. :dunce:

[butterblood]

Is it true that with an S corp you also don't have to pay into Medicare and Social Security come tax time?

[ob1kanobee]

Ask your accountant about forming an LLC with a corporation underneath it. I hear that is really the way to go. It all depends on your situation but I would be curious to see what he/she says.

[gueuzeman]

well, corporate profits are not subject to medicare and social security, but your payroll to yourself as an employee of the corporation are. Not really sure that you can work for nothing and just take profit as a shareholder.

Don't think corporate greed, see how badly that worked for the wall street guys.

gueuze

[cx]

You really need to talk to that accountant about your individual situation, Jamie. There are ways to avoid some payroll taxes with an S-Corp, but not if you're making all your money actually doing the work that's generating the income.

It's good for some setups, and I certainly encourage everyone to avoid giving the parasites a dime you can avoid, but you gotta be sure it fits your personal business requirements.

[sandbagger]

Not really sure that you can work for nothing and just take profit as a shareholder.I dunno, seems to work for Warren Buffet. Of course those silly stories about how his secretary pays more income tax than he does always fail to mention this little detail. :uhh:

[butterblood]

Well I saw the money I would have saved last year if I didn't pay MC and SS taxes and I got all giddy inside.
Plus if I don't just fall over dead while working then I'm not really counting on Social Security benefits when I am ready to retire in thirty years from now.
He said it only run me about $600 a year but I would save 4 or 5 times that come tax time.
Of course, the last thing I want to do is cheat the govt. out of any money or anyone who is collecting a full Mass pension but still working full time in RI.

[Levi the Tile Guy]

My attorney explained it to me that I would save a little money as an S corp over a llc, but I make under 100k a year. When you get over that range is when it really starts making a difference.