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What are the tax benefits of setting up a S Corp versus other corporate structures?
Any potential disadvantages?
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Listen to the audio
- To listen to this interview snippet, just click the play button above (twice if necessary).
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In this audio snippet, you'll hear about:
- Save some money on self employment taxes
- Advantages when it comes to buying and selling the S Corp
Audio Transcript
Travis:
What are
the tax benefits of setting up an S–Corp versus other corporate
structures and what are any potential disadvantages?
Yosef:
Well, as we noted earlier, some of the advantages of an S–Corp include
the fact that you only have one layer of tax, because the corporation
itself is not necessarily going to be taxed at the federal level. Mind
you, there are certain circumstances, where that may not be the case.
But generally, that is so.
Additionally,
there is the advantage of saving some money on self–employment taxes,
depending on the circumstances of the kind of business that we are
talking about.
There are also other advantages when it comes
to buying and selling the S–Corporation. But then again, those types of
issues are going to be again a little beyond the scope of what people
will generally understand. But you have to do a calculation of your
basis and the interest that you own and how much capital gain tax you
will be paying. But again, there are certain advantages to
S–Corporations that should be considered. Again, if somebody is
thinking about buying or selling an S–Corporation they should really be
speaking to an attorney who specializes in that.
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