An LLC is a tax entity, and an S-Corp is a filing status you elect. As far as the IRS is concerned, you're either a sole proprietor, a partnership, or a corporation. Now, they want to see what you're doing with your LLC, too. That used to be between you and the state.
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Yeah, but the profits pass through to your income taxes where you have to pay federal and local taxes. The only difference is that there's no FICA tax. The Feds just don't directly tax the corporation on the profits like they would with a C-Corp. You're saving money on paying less FICA and potential deductions and expenses a corporation can take. [With the K-1, a partner's earnings can be taxed at an individual tax rate versus the corporate tax rate. The tax rate an owner/shareholder pays on S corp profits is determined by their individual income-tax rate, which can be anywhere from 10% to 37%, depending …]
00:37 be sure to watch this part of the video explaining the S-Corp vs LLC. S-Corp or S-Corp Depends on several factors. I do offer consultations, use the following link to schedule an appointment. calendly.com/anthony-eataxresolutions/tax-consultation-s-corp?month=2022-11
I’m a new booty at this, but at the end of the video you said distribute the profits into your personal account before you continue to get taxed on it…so does this mean you have to get taxed on the profit AGAIN!!! When you distribute the profit to your personal account ?
Exactly my question. If you are paying yourself a salary, then you take the distribution of the profits to your personal account, aren't you making more money. He did not explain that very well to the beginners like us.
In 2022 we elected for 2023 to be taxed as a S Corp. So of course now it’s 2024 and tax deadline for Scorp filing is a few weeks away. I got confused at the point where you said the 40K is thru payroll which we are, and use QB, along with our other employees but when you said the 60K thru distribution just do a transfer. So I get that but, we didn’t take any distributions from profits at all….so yeah, profit sitting in the bank…1st question is it OK for NOT to take any distributions? And 2nd….are we still taxed on that profit sitting in the bank.
Hey! I will be going over your comment in my upcoming livestream! Hope this helps! If you have any other questions I go live every Monday at 4P.M. PST. th-cam.com/users/liveSHkqV4_UN90
Very curious, am I required by the state of California to provide myself with workmans comp as a general contractor if I am an employee of the S Corp? If so- this would add quite a bit to the cost of placing yourself on payroll. Its almost $1 per $1 for workmans comp as your earning wage, so technically that would be an expense that seems you would avoid as a sole prop. I wonder if anyone else has had this same question.
thank you for the helpful info - one question. In your example SP had profit of 100k, S-corp withheld taxes on payrole, but theres still the 60k that you keep referencing gets taxed. So where exactly is the tax savings? arent you just paying the same taxes but in the s-corp you pay quarterly on the 60K? slightly confused. Thanks!
may have found the answer in your video: th-cam.com/video/lsrpDFgicOU/w-d-xo.htmlsi=jjAGfsamhXNQcinH&t=121 the PROFIT (60k) of a S-Corp doesn't pay FICA. So I guess the strategy here being - pay yourself as low a salary as is "reasonable" and then hope for a larger distribution as personal income later only to be taxed as typical income at the bracket rate (without 15% FICA deduction)? more thinking out loud but thought id leave it here.
00:37 LLC = Legal, S-Corp = tax. We can "elect" the S-Corp tax entity, however we do not set up legal entities (LLC, Corporation) as we are not attorneys.
can SCorp salary people get the 50% self employment deduction? or no since they are employing themself through the SCorp. and can SCorp salary people get the Standard deduction of 12k? and can they get the 1099 20% deduction?
do you have to pay taxes of the left over profit after you pay yourself salary? what percentage? Also how do you get the stock requirement to become SCorp?
Whats with all the titles saying this is an explanation for dummies? It's not very validating for the viewer and it makes it seem less credible from the creator. Why not just "simplified" or an "easy guide"
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🤵S Corporation Analysis Consultation: calendly.com/anthony-eataxresolutions/tax-consultation-s-corp
This was a great video. Wish I had seen this first before all the articles/blogs I read all freaking weekend
Glad it was helpful!
An LLC is a tax entity, and an S-Corp is a filing status you elect. As far as the IRS is concerned, you're either a sole proprietor, a partnership, or a corporation. Now, they want to see what you're doing with your LLC, too. That used to be between you and the state.
Very helpful. Enjoyed the presentation and using blank tax documents to walk through the examples. Thanks!
Glad it was helpful!
I love the way you breakdown everything so simple
Glad to be able to help!
this was the most helpful video explaining S-Corp taxes THANK YOU
You're very welcome! Glad it was helpful!
this was so helpful! the breakdown was simple and I really really appreciated it!
Glad I could help
This was so helpful. Thank you!
so incredibly helpful and well explained! thank you
Glad it was helpful!
Hey Guys! If you want to help our channel outplease use turbotax through our link!
Our TurboTax Link: www.tkqlhce.com/click-100683865-11557904?url=https%3A%2F%2Fturbotax.intuit.com%2Flp%2Faff%2F4049%3F%26priorityCode%3D6099000412
Yeah, but the profits pass through to your income taxes where you have to pay federal and local taxes. The only difference is that there's no FICA tax. The Feds just don't directly tax the corporation on the profits like they would with a C-Corp. You're saving money on paying less FICA and potential deductions and expenses a corporation can take. [With the K-1, a partner's earnings can be taxed at an individual tax rate versus the corporate tax rate. The tax rate an owner/shareholder pays on S corp profits is determined by their individual income-tax rate, which can be anywhere from 10% to 37%, depending …]
Do you have a tax course on learning Corp/Partnership returns? The way you explain works very well for me! Lol I’m also a new Tax Preparer!
We have a free course on our channel, check out the playlist: th-cam.com/video/whL9BNu2BI4/w-d-xo.html
6:08 At your marginal tax rate between 10-37%. You're not just paying state and local like you just said a minute ago. You're just not paying FICA.
but we will get taxed on the personal side if i distribute the profits?
Do you recommend an S or C corp or LLC? I want to pay the least amount of taxes. Do you offer consultation?
00:37 be sure to watch this part of the video explaining the S-Corp vs LLC.
S-Corp or S-Corp Depends on several factors.
I do offer consultations, use the following link to schedule an appointment. calendly.com/anthony-eataxresolutions/tax-consultation-s-corp?month=2022-11
we all do, But it gets Super sticky...so...ahh, good luck... either way seems like DC Wins!!
I’m a new booty at this, but at the end of the video you said distribute the profits into your personal account before you continue to get taxed on it…so does this mean you have to get taxed on the profit AGAIN!!! When you distribute the profit to your personal account ?
Exactly my question. If you are paying yourself a salary, then you take the distribution of the profits to your personal account, aren't you making more money. He did not explain that very well to the beginners like us.
I’m not dumb, I just needed it broken down lol
In 2022 we elected for 2023 to be taxed as a S Corp.
So of course now it’s 2024 and tax deadline for Scorp filing is a few weeks away.
I got confused at the point where you said the 40K is thru payroll which we are, and use QB, along with our other employees but when you said the 60K thru distribution just do a transfer. So I get that but, we didn’t take any distributions from profits at all….so yeah, profit sitting in the bank…1st question is it OK for NOT to take any distributions? And 2nd….are we still taxed on that profit sitting in the bank.
Hey! I will be going over your comment in my upcoming livestream! Hope this helps! If you have any other questions I go live every Monday at 4P.M. PST. th-cam.com/users/liveSHkqV4_UN90
Very curious, am I required by the state of California to provide myself with workmans comp as a general contractor if I am an employee of the S Corp? If so- this would add quite a bit to the cost of placing yourself on payroll. Its almost $1 per $1 for workmans comp as your earning wage, so technically that would be an expense that seems you would avoid as a sole prop. I wonder if anyone else has had this same question.
You don't need workers comp on yourself but you do need it in your employees if you have any
You don't need an LLC to file as an S-Corp. Absolutely not.
you are amazing
thank you for the helpful info - one question. In your example SP had profit of 100k, S-corp withheld taxes on payrole, but theres still the 60k that you keep referencing gets taxed. So where exactly is the tax savings? arent you just paying the same taxes but in the s-corp you pay quarterly on the 60K? slightly confused. Thanks!
may have found the answer in your video: th-cam.com/video/lsrpDFgicOU/w-d-xo.htmlsi=jjAGfsamhXNQcinH&t=121
the PROFIT (60k) of a S-Corp doesn't pay FICA. So I guess the strategy here being - pay yourself as low a salary as is "reasonable" and then hope for a larger distribution as personal income later only to be taxed as typical income at the bracket rate (without 15% FICA deduction)?
more thinking out loud but thought id leave it here.
how many times can do i distribution ? is there a limit or rule of thumb on how many times we can do?
Can we take further deductions on our own personal tax returns (schedule C) that was passed down from the payroll or K1 income
Can you set up my S corp? or just an LLC?
00:37 LLC = Legal, S-Corp = tax.
We can "elect" the S-Corp tax entity, however we do not set up legal entities (LLC, Corporation) as we are not attorneys.
how do you write off business supplies and like subscription fees? for s corp.
Use you business CC or bank account and report it on the form 1120S
I am doing a school project and am having a hard time finding corps that are s corps, can someone help me out
Most small businesses are S-Corp. I'm sure you can ask small businesses in your area if they are S-Corps to find one.
I woulda sworn there were two e's in Bookeping.
can SCorp salary people get the 50% self employment deduction? or no since they are employing themself through the SCorp.
and
can SCorp salary people get the Standard deduction of 12k?
and
can they get the 1099 20% deduction?
do you have to pay taxes of the left over profit after you pay yourself salary?
what percentage?
Also
how do you get the stock requirement to become SCorp?
Whats with all the titles saying this is an explanation for dummies? It's not very validating for the viewer and it makes it seem less credible from the creator. Why not just "simplified" or an "easy guide"