Monday, July 26, 2010

Why should I Start An S Corporation?

S corporation set up may be fruitful for several reasons:

* Forming S corporation generally allows you to pass business losses through to your personal income tax return, where you can use it to offset any income that you have from other sources.

* S Corp shareholders are not subject to self-employment taxes. These taxes, which add up to more than 15% of your income, are used to pay your Social Security and Medicare taxes.

* When you sell your S Corp, your taxable gain on the sale of the business can be less than it would have been had you operated the business as a regular corporation.



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