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Corporation Tax?
Posted by admin on Sep 15th, 2008
naturalway42 asked:
A corporation makes $250K / year. Its expenses are $50K.
=> Net profit of 250 – 50 = $200K.
A corporation makes $250K / year. Its expenses are $50K.
=> Net profit of 250 – 50 = $200K.
The corporation intends to buy real estate in future and needs to save money so if the corporation buys shares of other corporations (like yahoo, google, walmart) for $200K.
Does that mean the corporation nets to zero dollars and not have any taxes for that year? Or the corporation must pay tax first and then invest?
i belive you have to pay taxes first
No, investments are not expenses. Only expenses related to the business may be expensed against business income.