Business owners can choose among at least six different types of business structures, each with its own tax advantages and restrictions. For your particular situation, we can customize the strategies to save taxes.
The taxable income that Subchapter S Corporations pass through to their shareholders is unscathed by two additional taxes that take effect in 2013. (For a description of S Corporations, see Tax Classification of Businesses.)
S Corporation pass-through income is distinct from employment income or self-employment income. Of course, a shareholder-employee needs to take a relatively modest portion of S Corporation income as wages, triggering employment tax.
The 0.9% increase in the Medicare tax (0.9%) on high earners does not apply to S Corporation pass-through income.
The second additional tax of 3.8%, applies to net investment income of high earners, including interest, dividends, and capital gains. Even though S corporation pass-through income resembles a deemed dividend, it is not automatically subject to this net investment income tax. (more…)
An attorney who is a Certified Specialist in Taxation Law can help you find a tax-efficient path to get where you want to go. Coordination with your accountant, financial planner, and business attorney is crucial in this process.
MICHAEL FOLZ WEXLER has practiced in varied fields of taxation law for more than 25 years.
- Certified Specialist in Taxation Law since 1994.
- Harvard University, A.B. summa cum laude, 1983
- University of Chicago Law School, J.D. with honors, 1986
Recently I attended two inspiring events honoring persons involved with charity in San Diego. On November 7, National Philanthropy Day, the Association of Fundraising Professionals, San Diego Chapter hosted an honors luncheon
attended by over 800 persons. Honorees included the California Endowment, which is promoting health in City Heights, Outstanding Fundraising Volunteer Joyce Glazer, and Keri Jucha, a teenager who makes jewelry to raise money for Rady Children’s Hospital.