We are expected to pay taxes at the time we earn income, so we need to make tax payments during the year. This avoids penalties for underpayment of estimated taxes, and reduces the chance of being slammed with a huge bill at tax time. To avoid a penalty, you need to pay either 100% of …
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Small Business Retirement Plans
This article discusses some of the options my clients look at when choosing the most appropriate personal or business retirement plan. Tax rules around retirement plans are endlessly complex, and there are numerous options available, so this is just a look at some of the most common plans. I am also not including all the …
Another Look at S Corps
An S Corporation can be a beneficial business entity. But not always. Many accountants advise their small business clients to form S Corps, but there are a lot of variables to take into consideration. I have discussed S Corps previously in this blog. This time I want to emphasize who does and doesn’t benefit from …
California Passthrough Entity Elective Tax (PTET)
The California passthrough entity elective tax (PTET) is intended to give relief to taxpayers affected by the limitation on deductibility of state and local taxes (SALT) introduced a few years ago. The idea is that your S corporation, partnership or LLC (but not a single member LLC) can elect to pay a 9.3% tax on …
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Time for an S Corp… or Not
Your accountant told you that you need an S Corporation… They often do, when your business tips over about $100,000. “It’s great…” they told you. “You only have to pay out part of your profit as salary, so you don’t pay social security or Medicare on the rest.” And you know S Corps have to …
Things to Do (and Not Do) With Your S Corp
An S Corporation is a useful vehicle, and it provides many benefits. There are, however, rules that need to be followed… and some opportunities that you shouldn’t miss. Get a Bookkeeper You are running a substantial business, and saving money on accounting is not a wise idea. Recording transactions on Quick Books is a good …
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“Doing Business” in California
“What do you mean I have to pay California tax on my LLC? It’s registered in (name a state)” How many times have I heard a California client say that in an outraged tone? Many people register their LLCs in other states, in an effort to avoid California taxes. There was a time when TV …
An LLC, an S Corp, or… What?
My clients often ask me to help them choose the best entity for their business. Many just assume it should be an LLC, even when there is no good reason to have one. Others have been talking to relatives and friends who routinely recommend an S Corporation. Others don’t bother to ask me until they …
Employee or Independent Contractor?
I first came upon this issue some years ago, when I produced an independent motion picture (Pterodactyl Woman From Beverly Hills – look it up). I had no experience with filmmaking, and had never run a business before, so we paid everyone – actors, artists, drivers, electricians, etc. – with 1099s, treating them as independent …
Your S Corporation – A Checkup
In my experience, a lot of people don’t pay enough attention to their Subchapter S Corporations until tax time, when it’s sometimes too late to correct errors or oversights. You formed the S Corp because of the benefits you would get from it, so it would be a shame to operate it in such a …
Bruce Critchley Tax 