Facing a still-difficult economy and a flurry of tax changes, business owners must be especially alert to new tax pitfalls and opportunities. To help our small business readers, Business.com collected top tips from leading small business tax experts coast-to-coast. What Works for Business will run a new tip daily for 10 business days.
Small Business Tax Tip #6: Bank on a C-corporation Comeback: According to John Smolke, CPA with Seattle-based Peterson Sullivan, “The prospect of increased future tax rates means business owners should consider the most appropriate form of business operation. C-corporations may make a comeback if individual tax rates are increased to 39.6 percent; if a surtax of 5.4 percent is imposed on high AGI taxpayers; or if additional Medicare taxes are imposed on high-income taxpayers. Paying taxes at C-corp rates may make the most sense, especially during the years when the business needs to build up its equity.”
Check back tomorrow for the next expert Tax Tip in our series. For the latest small business tax solutions and advice, including tax services, accounting software, accounting firms and CPAs, visit the Accounting channel at Business.com.