3 Factors to Consider BEFORE You Become an S-Corporation

3 Factors to Consider BEFORE You Become an S-Corporation

You might have seen or heard somewhere that making the S-Corporation election for your small business can save you tax dollars. It can. But before jumping into an S-Corp, there’s a wealth of legal paperwork and formality. Take some time to consider whether this is really what you want, and contact us if you need some help deciding. We’re going to look at three major areas of inquiry when it comes to determining whether you are ready to make the step towards incorporation. https://www.youtube.com/watch?v=xn_jwaEFLIo&feature=youtu.be Is Your Business Income and Cash Collection Steady? Owners of S-Corporations are also employees. As employees,…
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Taking Money Out of an S-Corp: Draws vs. Salary

Taking Money Out of an S-Corp: Draws vs. Salary

https://youtu.be/VSnRp2qnXkM When you do business in your own name as a sole proprietorship, there isn’t really such a thing as a “salary” or a “distribution.” Clients and customers pay you, you pay taxes, done and done. As long as you keep your personal and business expenses separate, ideally using separate bank accounts, you’re good. As an S-Corporation, suddenly you have a choice to make every time money leaves the company’s “hands” and gets into yours: is it a draw or a salary? Draws Owner draws: Are usually either for estimated taxes, due to a specific event, or from business growth…
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How to Pay Estimated Taxes as an S-Corp

How to Pay Estimated Taxes as an S-Corp

https://youtu.be/sGqZ5fJEv94 When you earn money as an employee, you don’t have to make estimated tax payments throughout the year. Or, rather, the estimated tax payments are made automatically by your employer through the withholding process, and these payments that were made on your behalf all year are conveniently reported to you on your W-2. But as an S-Corporation business holder, none of this is automatically done for you. The Process Unfortunately, the annual schedule for estimated tax payments is very strange: Q1 estimated taxes are due by April 15th. So far so good. April and May estimated taxes are due…
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