Comments on: How is an s corporation taxed? http://www.moneysnatchers.com/corporations/how-is-an-s-corporation-taxed/ Thu, 10 Dec 2009 09:16:56 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Christopher P http://www.moneysnatchers.com/corporations/how-is-an-s-corporation-taxed/#comment-276 Christopher P Mon, 23 Mar 2009 01:39:20 +0000 http://www.moneysnatchers.com/corporations/how-is-an-s-corporation-taxed/#comment-276 When the S corp is taxed it does not make a difference for income tax whether it is a dividend or salary. The biggest issue to consider is FICA taxes. The salary will be subject to FICA tax but the dividends will not. You can experience substantial tax savings by paying out the money as dividends. Be careful though because the IRS requires that any S-corp pay its officers a reasonable salary so that someone does not avoid all FICA taxes. When the S corp is taxed it does not make a difference for income tax whether it is a dividend or salary.

The biggest issue to consider is FICA taxes. The salary will be subject to FICA tax but the dividends will not. You can experience substantial tax savings by paying out the money as dividends. Be careful though because the IRS requires that any S-corp pay its officers a reasonable salary so that someone does not avoid all FICA taxes.

]]> By: Jeff D http://www.moneysnatchers.com/corporations/how-is-an-s-corporation-taxed/#comment-275 Jeff D Fri, 20 Mar 2009 08:51:50 +0000 http://www.moneysnatchers.com/corporations/how-is-an-s-corporation-taxed/#comment-275 income tax, 30% in Untied States and yes still the 30% applies if you try to scam through dividends. Although i suggest skimming if you know what i mean ;) income tax, 30% in Untied States
and yes still the 30% applies if you try to scam through dividends. Although i suggest skimming if you know what i mean ;)

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