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Member You - More Truth About Subchapter S Corporations
What? You want me to share my web hosting? You may wonder what this is all about since you're the one paying for hosting services every month. Actually, most web sites utilize the service of shared web hosting. When it comes to hosting your site, sharing can be quite economical.How shared web hosting works is that a group of clients share virtual space on the web server. How many accounts share this virtual space varies by host. Some host providers have a few hundred shared accounts on the same server, where as others have a few thousand. Also know as virtual hosting, shared web hosting shares much more than just virtual web space on a server.If you have a shared web hosting account, you may not re
If I am going to form a new business, I will first assess the need to limit liability. If I decide to form an entity at all, I will t
I had a discussion recently with one of my newsletter subscribers. He brought up the topic of forex and made the inquiry "isn't that mainly a professional market?", which is something I've heard a great many times.Certainly forex used to be pretty much exclusively the domain of the pros. It was very difficult for the individual trader to play that market. Starting in the late 1990s, though, that began to change. Individual trading accounts become more readily available. Since then there has been an explosion in forex brokersThe great thing about that development is its impact on part-time traders. Forex is a fantastic part-time trading market. It operates 24-hours, so one can trade at any time of d
Let's start by defining what a subchapter S corporation represents. The entity is formed at the state level and serves to provide liability protection for its owner or owners. After the entity is formed, the decision is made to become a S corporation. This is a tax election. One files form 2553 with Internal Revenue by the 15th day of the third month of a given year and is afforded S corporation status for this year. As opposed to a C corporation (a taxable entity in and of itself), earnings from the S corporation flow through to its shareholders avoiding any corporate level tax. These flow-throws avoid the implementation of self-employment taxes (or SE tax) making it seem quite beneficial to would be taxpayers. As with many situations in the world of income tax, beauty is only skin deep leading us to a world of tax traps and audit magnets. What is a business owner to do when faced with making the decision to be a S corporation? The business owner should be listening to my show, "Better Business" as well as reading all of my articles to best inform himself of what lies ahead. As always, you are invited to get clarification of what I discuss through my articles or through my radio program (see below on how to get your questions answered for free).
If I am going to form a new business, I will first assess the need to limit liability. If I decide to form an entity at all, I will th
One of the best ways for potential clients to find out about you and your company is through public speaking. Free seminars attract potential clients. It is a chance for them to get information straight from you. You are the best marketing tool for your business. Speaking to groups is nothing more than a large conversation. It is powerful and efficient marketing.By making the seminar free, you engender goodwill from your audience. By addressing issues of concern to them, you are validating their perceptions that the topic you are speaking about, is an important one. By offering good, sound, and thorough advice, you establish yourself as an expert.A number of dynamics take place when you are in fron
Let's start by defining what a subchapter S corporation represents. The entity is formed at the state level and serves to provide liability protection for its owner or owners. After the entity is formed, the decision is made to become a S corporation. This is a tax election. One files form 2553 with Internal Revenue by the 15th day of the third month of a given year and is afforded S corporation status for this year. As opposed to a C corporation (a taxable entity in and of itself), earnings from the S corporation flow through to its shareholders avoiding any corporate level tax. These flow-throws avoid the implementation of self-employment taxes (or SE tax) making it seem quite beneficial to would be taxpayers. As with many situations in the world of income tax, beauty is only skin deep leading us to a world of tax traps and audit magnets. What is a business owner to do when faced with making the decision to be a S corporation? The business owner should be listening to my show, "Better Business" as well as reading all of my articles to best inform himself of what lies ahead. As always, you are invited to get clarification of what I discuss through my articles or through my radio program (see below on how to get your questions answered for free).
If I am going to form a new business, I will first assess the need to limit liability. If I decide to form an entity at all, I will t
It's tough for any business to do without direct mailing these days. You might mail prospective customers using the Internet or maybe you prefer to rely on the postal system. Maybe you use a combination of both. Whatever your preference, the writing on the wall for any business is clear: you need direct mail. Used effectively, this is your trigger to sales.How do you go about it? You need lists. Maybe you already have one. Use it as a first phase to tell your customers about what you have for them that's new. If you don't have anything new, set about correcting that. Whatever it is - a promotion, free offer, discount, - use direct mail to make sure your customer knows about it. Your product, your company
If I am going to form a new business, I will first assess the need to limit liability. If I decide to form an entity at all, I will t
A non-profit association is an incorporated association run with the primary purpose other than to make profit. The not-for-profit associations fall into three categories. Educational institutions and charitable associations for public benefit, trusts for the mutual benefit of the members and religious establishments like churches, religious beneficial programs and religious education. Churches are theological institutions with Jesus Christ as the head. Churches exist for the worship of God. Other activities include proselytizing, i.e. spreading the word of God to others and other charitable works. Churches have many denominations like Catholics, Protestants, etc.By the definition of corporation as a lega
If I am going to form a new business, I will first assess the need to limit liability. If I decide to form an entity at all, I will t
Recently I was visiting some family members over the holiday season. I thought I would drop into my favorite pizza outlet and sneak one of their luscious pies that I really should not be eating. You see, (and this is my gilt-edged excuse...) I don't have one of these outlets within 500 miles of where I now live, so I figure this is a good excuse to cheat on the old diet a bit.I had not been in this outlet for more than 18+ months, and then only a few times. The owner-franchisee (let's call him Vijay for simplicity) was in the back; but the moment he saw me, he came out with a huge smile and said: "Hello Mr. double-cheese-sausage-and-mushroom...how are you?" He did not remember my name (if he ever knew it
If I am going to form a new business, I will first assess the need to limit liability. If I decide to form an entity at all, I will then decide on the best form for business and income tax considerations. The S corporation is good for single owners and situations where it is practical to allocate income and losses based on ownership percentages. Let's use the example of you and I forming a business entity and owning it on a 50/50 footing. We might set our salaries at $50,000 each with additional earnings allocated to us on a 50/50 basis. This will work fine as long as we both agree that we have the same value to the business. But what if you do more work than I do? Well, you could take more salary possibly and then we could split any remaining earnings 50/50. We could however, get to the point where we are taking out salary to balance our improprieties thus defeating one of the purposes of electing S status in the first place. Please give careful consideration as to who the owners will be and how profits and losses will be divided.
What about deducting losses incurred at the S corporation level on the personal returns of its shareholders?Is this allowable? I just read an article that said you can do this very thing. I caution you to beware. There is such a concept as basis limitation. If it is projected that losses will result in the first few years of operation, one must have basis in order to deduct these losses personally. Basis in subchapter S stock will consist of capital contributions such as stock and loans made by the shareholder or shareholders directly to the entity. We cannot simply personally guarantee the loans and have the proceeds then deposited in the S corporation. If we are going to borrow money to loan to
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