which kind of corporation is better?

[cla9060]

What is the name of your state?

if i want to open a corporation to work at home which one can be the best to get advanted of the tax deductions? and is easy to declare taxes.....


thank you.

[abezon]

An S-corp or LLC will let you claim a net loss, but you have to pay self-employment taxes on all profits. A C-corp will let you pay employment taxes on only a 'reasonable salary' & take the rest of the profits as dividends, but the c-corp will also pay taxes.

What do you plan to do & how much profit will you make?

[LdiJ]

Originally Posted by abezon

An S-corp or LLC will let you claim a net loss, but you have to pay self-employment taxes on all profits. A C-corp will let you pay employment taxes on only a 'reasonable salary' & take the rest of the profits as dividends, but the c-corp will also pay taxes.

What do you plan to do & how much profit will you make?

That isn't correct. S-corp pass through income is not subject to self-employment taxes. Partnership or sole proprietorship income is, but not S-corp income. The feds have been making noises about changing that, but so far they haven't.

Now, if you actively participate in the S-corp and don't pay yourself a reasonable salary for the duties performed, then the IRS can hit you on some self employment taxes....but otherwise no.

[abezon]

yep, I mistyped.