Posted on 10/17/2012 9:02:46 AM PDT by The Louiswu
All money coming out of a Sub S is taxed as ordinary income.
The author gives away his ignorance when he states that money left in the company isn't taxed. That's not true for an S corporation since the tax is on the corporation's book income, not cash dividend payments to the owners.
High tax rates on corporate earnings slow job growth, increase prices for consumers, and lead to wasted use of resources. Put another way, if you have to pay a high enough tax rate on your S corporation or LLC, then you might as well do whatever you can to steer as much of the profit of the corporation into fancy office furniture, nice company cars, boats and planes, and sales offices in warm climates so you can enjoy your work day without paying as many taxes as you would otherwise. Needless to say those kinds of decisions result in fewer jobs in the USA.
Less profit from taxation = more money to expand business?
Pass the blunt Barry Bogart!
“All money coming out of a Sub S is taxed as ordinary income.”
That’s wrong. Income that is previously taxed as s corp profits are not taxed when taken out of the corporation by the stockholders.
During the Bush Years, a very small local business (music store) was able to expand into twice their size, hire a manager, hire at least six music teachers, and have a store plus a busy music school.
2 years into the Obama Administration, the whole thing folded.
The two store fronts are STILL empty.
Crap. I could post enough libertard incoherence from Facebook to bring JR’s servers to their knees.
This actually makes more sense than most!
BTW a good article that answers this rambling post and explains the Laffer Curve is this one:
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