Seattle Friendly
jjjpl:
Wow. You really drank the cool-aid didn’t you.
No. Mark’s example is not right. If “a company leaves $1 million profit in the business at the end of the year to open a new location” then the owner, assuming there is only one owner, would only pay 30K in tax, not 90K in tax.
And you are wrong that “once the government collects the tax, it is gone forever.” You can write off the tax you paid in flow-through profits in year X if you reinvest it in your company in year X+1. So in effect, the government gives it back to you.
You really should not go into business. Even after 1098 you can leave up to 400K in your business without having to pay a penny of income tax on the flow-through. And that assumes that the S-Corp only has 1 shareholder! If the S-Corp had 4 equal shareholders, it could leave 1.6 million in the bank without any of the owners suffering ANY tax liability. That’s a hell of a lot more than in ANY other state in the country except 6 states.
I really hope I didn’t hurt Mark’s feelings. I’m super concerned about hurting the feelings of a guy who distorts the truth every day for elite business interests at the expense of the middle class and small business owners like me.