Skip to comments.'Loophole' Closing Eyed to Fund Student Loan Policy [More Taxes For Subchapter S Corp Owners]
Posted on 04/23/2012 7:09:30 PM PDT by Steelfish
'Loophole' Closing Eyed to Fund Student Loan Policy
BY CAROL E. LEE AND JOHN D. MCKINNON [Subscriber Content Preview]
The White House and Senate Democrats are looking at ending a tax provision benefiting some small business owners to pay for a year-long extension of a freeze in student loan interest rates, which are scheduled to double from 3.4% to 6.8% this summer, people familiar with the discussions said.
The measure would change a feature of tax law that critics say has allowed many owners of small businessesparticularly those known as Subchapter S corporationsto escape employment taxes on much of their earnings.
Employment taxes totaling 15.3% generally are imposed on the wages that owners pay to themselves from their businesses, ...
(Excerpt) Read more at online.wsj.com ...
Just mentioning this will cause small businesses to cut back on plans for hiring.
This is barry’s strategy create uncertainty then blame the rich.
So when my S-Corp business shows a paper profit and it is “ distributed” to me at the end of the year, I will have to pay employment taxes???? even though I never see that money and have to pay income tax out of my own pocket? This is BS
I just don’t understand why people can’t see this or any tax for what it is. Out right theft at gun point by the government.
The article is firewalled and the lead in gives NO useful information. I’d be interested in seeing a link to actual information about this. But not interested in paying for WSJ’s online subscription.
If all payments to me are to be in the form of payroll, then that means that I will never realise a dividend payment in the form of a dispersal. In other words, I can’t own shares in my own company.