S-corporations are one of the most frequently discussed (but often misunderstood) tax structures for small business owners. While they can offer real savings on self-employment taxes, the benefits aren’t automatic – they depend on your income level, involvement in the business, and whether you’re ready to manage the added compliance responsibilities. Here’s what you need to know about how S-corps work, who they’re right for, and what’s required to maintain one.
Tag: LLC
Understanding K-1 Income in Retirement Plan Design
A frequent and complex challenge for retirement plan advisors can be properly defining compensation for plan eligibility and contribution purposes, including income reported on a Schedule K‑1. Improper reporting of K-1 income may result in compliance errors, contribution miscalculations, and/or plan disqualification. What is K-1 Compensation? Owners of partnerships and LLCs taxed as partnerships typically… [keep reading…]
The Corporate Transparency Act
The Corporate Transparency Act In an era marked by increasing economic interconnectivity, transparency in corporate practices has become a critical aspect of ensuring fair and ethical business conduct. Signed into law on January 1, 2021 as part of the National Defense Authorization Act, the Corporate Transparency Act (CTA) seeks to enhance corporate transparency by addressing… [keep reading…]