Corporation

Corporations are used to protect personal assets against business creditors and to limit the liability of business creditors to the assets of the corporation. In order to protect against double taxation, you may choose a Subchapter S election which allocates income directly to you as shareholders.

It also allows you to allocate part of the company income to you as wages which would be subject to FICA and part of the company income to you as dividends that are not subject to FICA. This can reduce your FICA obligation from about $12,000 to about $6,000.

$495

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