[walden]

No, you remember correctly-- that's the self-employment tax, and you pay the whole thing. However, since the tax law change, if you pay yourself dividends rather than salary, I think that you only pay income tax on 50% of that amount and no self-employment tax on it at all. That option wasn't available until recently, but now, it's definitely the way to go.

I do think you need to set it up as either a regular corporation or a Sub-S for that to work, though. Can't just use the regular 1040 with the sole proprietor form.

[freedumb2003]

Thanks for the advice.

Yes, it needs to be run by the legal beagles, but the concept is great.

Good idea - everyone on the site should think about it.