..."when it fails..." Weren't ALL businesses, small businesses, at some point? (McDonalds, Hewlett Packard, Apple, the Winklevoss twins version of Facebook, shall I go on.) Question LegaLees: Are you a small business? There's nothing on earth quite like planning to take a loss. The metaphysics are astounding. How about something useful, (like some advice on when/how/who should, and why you WOULD use one of the most versatile entities known to conduct your business). Or should you just plan to stay small, and always know that when you fail, your loss will available to 'take advantage of?
C corp is for big businesses that are destined to succeed. Only start a C corp with little or none of your own money. C corp allows for many stock holder investors.
If you are a professional services business with another business generating income, it is better to be a C corp. Exiting the business is taxed at capital gains rates. You can treat the C corp as a savings account as well - pay yourself minimum over time in the future. 5 Years of Carryback allows to reclaim any tax paid (21%) for 5 previous years. What's not to like. Also, great if you are getting a bonus - invoice it from your C corp.
And you are looking at it from the perspective of a loser, why? Suppose my business has netted consistently $300k for a couple years now and I'd like to not pay personal income tax on that now. I don't currently have a retirement account. Single, no dependents. I would also be happy with a $80k range paycheck, yearly. Tell me why I should be paying personal income tax rate virtually as high as the double tax corporate rate? On money I could put to work? I could spend unlimited amounts of money buying producing mineral rights. Tell me where is the benefit from doing that taxed about as high as you can go? Your advise is for losers, because you are one?
If your company loses money, regardless of entity type. It's still a loss whether or not you get to mitigate it slightly with a write off. So whats your point sir?
With a C Corporation, you cannot take the loss on anything but income in the C Corporation. if the corporation is dead and has losses, you just lose those losses. They can’t ever be transferred to you or anywhere else.
@@Legaleescorp So the best method is to start as an LLC, then once your sufficiently profitable move to a C Corporation? That does seem a better strategy.
The point is if you lose in a Chapter C entity (corporation or LLC) then the only way you can “use” the loss to offset future taxes is to have the Chapter C entity keep making money. But, if the Chapter C entity has failed, you are closing the doors with a big loss that can never be used, because the Chapter C entity will never make money again that the loss can be used to offset. If it is a Subchapter S entity, then the loss will pass through to you and you can use it to offset your future taxes no matter where your income is coming from. The Subchapter S entity will be dead and not making money, but the loss is yours to use to offset future taxes. Does that help?
This guy fails to mention that your personal tax return is totally separate from your business. Your business gets audited, not you! This is a BIG BIG deal. I hate seeing dumb people not mention all aspects of the deal, just pick and choose their punches.
I don't know anything about taxes. I've never been in that bracket you actually pay taxes. I'm going to start a ccorp. I don't expect nor care about tax benefits. Sure I'll pay taxes when I make money but if things fail, no big loss.
I would still probably recommend against taxing your corporation under Chapter C or the IRS Code. Subchapter S was created for small business owners, and for almost all small businesses an S Corporation is better than a C Corporation.
LegaLees I am a consultant/ introducer, work between a lender investor marketing for leads in commercial projects. We find commercial owners who need money debt/equity for their projects. We put the two together, when the project is funded we get paid 1%. We have 3 projects in the pipeline, $200M, $65M and another $200M I’m set up as a c Corp not knowing what I’m doing with my new business! Any thoughts to help me setup correctly?
You probably should not be a C Corporation tax structure. I would pay a consulting fee to Ben Rucker, a former special auditor/agent with the IRS, and have him coach you through changing the corporate tax structure and planning your taxes for a year (2019). You will make a lot more money to take home and spend. Reach Ben at Ben.Rucker@irstaxrelief.com
The legal structure can be an LLC, and in most cases it should be an LLC instead of a corporation. The charging order protection of the LLC makes it more advantageous than a corporation. As far as taxation is concerned, you can have the LLC taxed under Chapter C (like a C Corporation), but I am going to ask you why do you want Chapter C taxation, and you had better have a good answer.
@@Legaleescorp I am not a lawyer or accountant I wouldn't know. The S-Corp sounds better because it's pass through. How would I attract venture capital though without C-Corp status
..."when it fails..."
Weren't ALL businesses, small businesses, at some point?
(McDonalds, Hewlett Packard, Apple, the Winklevoss twins version of Facebook, shall I go on.)
Question LegaLees: Are you a small business?
There's nothing on earth quite like planning to take a loss.
The metaphysics are astounding.
How about something useful, (like some advice on when/how/who should, and why you WOULD use one of the most versatile entities known to conduct your business).
Or should you just plan to stay small, and always know that when you fail, your loss will available to 'take advantage of?
Yes, we are a small business, but one that has kept in the black for over 30 years.
C corp is for big businesses that are destined to succeed. Only start a C corp with little or none of your own money. C corp allows for many stock holder investors.
If you are a professional services business with another business generating income, it is better to be a C corp. Exiting the business is taxed at capital gains rates. You can treat the C corp as a savings account as well - pay yourself minimum over time in the future. 5 Years of Carryback allows to reclaim any tax paid (21%) for 5 previous years.
What's not to like. Also, great if you are getting a bonus - invoice it from your C corp.
And you are looking at it from the perspective of a loser, why? Suppose my business has netted consistently $300k for a couple years now and I'd like to not pay personal income tax on that now. I don't currently have a retirement account. Single, no dependents. I would also be happy with a $80k range paycheck, yearly. Tell me why I should be paying personal income tax rate virtually as high as the double tax corporate rate? On money I could put to work? I could spend unlimited amounts of money buying producing mineral rights. Tell me where is the benefit from doing that taxed about as high as you can go? Your advise is for losers, because you are one?
If your company loses money, regardless of entity type. It's still a loss whether or not you get to mitigate it slightly with a write off. So whats your point sir?
With a C Corporation, you cannot take the loss on anything but income in the C Corporation. if the corporation is dead and has losses, you just lose those losses. They can’t ever be transferred to you or anywhere else.
@@Legaleescorp So the best method is to start as an LLC, then once your sufficiently profitable move to a C Corporation? That does seem a better strategy.
The point is if you lose in a Chapter C entity (corporation or LLC) then the only way you can “use” the loss to offset future taxes is to have the Chapter C entity keep making money. But, if the Chapter C entity has failed, you are closing the doors with a big loss that can never be used, because the Chapter C entity will never make money again that the loss can be used to offset. If it is a Subchapter S entity, then the loss will pass through to you and you can use it to offset your future taxes no matter where your income is coming from. The Subchapter S entity will be dead and not making money, but the loss is yours to use to offset future taxes. Does that help?
This guy fails to mention that your personal tax return is totally separate from your business. Your business gets audited, not you! This is a BIG BIG deal. I hate seeing dumb people not mention all aspects of the deal, just pick and choose their punches.
Can a Startup start with S-Corp/LLC, and later (1-2 years later) convert your Startup entity to C-Corp ?
yes you can no clue why this guy post videos and not respond to his watchers.
We do reply a lot, but sometimes miss some comments
Yes
I don't know anything about taxes. I've never been in that bracket you actually pay taxes. I'm going to start a ccorp. I don't expect nor care about tax benefits. Sure I'll pay taxes when I make money but if things fail, no big loss.
I would still probably recommend against taxing your corporation under Chapter C or the IRS Code. Subchapter S was created for small business owners, and for almost all small businesses an S Corporation is better than a C Corporation.
@@Legaleescorp Thank you. I appreciate your feedback.
LegaLees I am a consultant/ introducer, work between a lender investor marketing for leads in commercial projects. We find commercial owners who need money debt/equity for their projects.
We put the two together, when the project is funded we get paid 1%. We have 3 projects in the pipeline, $200M, $65M and another $200M I’m set up as a c Corp not knowing what I’m doing with my new business! Any thoughts to help me setup correctly?
You probably should not be a C Corporation tax structure. I would pay a consulting fee to Ben Rucker, a former special auditor/agent with the IRS, and have him coach you through changing the corporate tax structure and planning your taxes for a year (2019). You will make a lot more money to take home and spend. Reach Ben at Ben.Rucker@irstaxrelief.com
@@Legaleescorp Cut and paste answer. C corp scares you.
So you're suggesting to become an LLC?
The legal structure can be an LLC, and in most cases it should be an LLC instead of a corporation. The charging order protection of the LLC makes it more advantageous than a corporation. As far as taxation is concerned, you can have the LLC taxed under Chapter C (like a C Corporation), but I am going to ask you why do you want Chapter C taxation, and you had better have a good answer.
@@Legaleescorp I am not a lawyer or accountant I wouldn't know. The S-Corp sounds better because it's pass through. How would I attract venture capital though without C-Corp status
This video was so negative ... BYE
I'm not going into business to fail..sorry
Thanks for layin it straight cowboy!