Accounting News and Notes

Duluth/Gwinnett CPA: LLC’s can Legally Convert to an S Corporation Saving Thousands Annually

LLC’s came in vogue approximately twenty years ago when the  state of Georgia enacted legislation allowing both LLC’s (Limited Liability Company’s) to be established. Although the LLC does allow for some greater flexibility and ease of operation it often results in a higher tax obligation that might have been incurred if the business is an S Corporation.

Tax law treats all the earned income from an LLC as being subject to both FICA & Medicaid taxes whereas an S Corporation has to pay these taxes reflected on W-2′s. Tax law allows an LLC to legally convert over to being an S Corporation, for tax services, as long as all active employee/owners pay their-selves a fair and reasonable salary. This number is best determined by the facts, position, and profit of a business and the truest test of this calculation is what a business owner would have to pay someone else to perform their position.

We offer a free initial consultation to see if converting your business to an S Corporation for tax purposes makes sense to you. Put our decades of experience to work for you ensuring you pay your lowest legal possible tax.

To read more and see which entity type is best for you visit http://www.hiscpa.com/article2.html 

We advise clients on: IRS representation, Offer in Compromise, Tax Problems, Incorporation in Georgia, Corporate and Personal Income Tax Returns, Part-time CFO, Virtual Controller, Business Planning, Back Taxes, Business Acquisitions/Sales, Forensic Accounting, Business Valuations and Bookkeeping.

HisCPA: A Christian CPA Firm in Duluth GA Proudly Serving Suwanee, Lawrenceville, Snellville, Lilburn, Duluth, Norcross, Peachtree Corners, Atlanta, Gwinnett, Fulton, Johns Creek, Roswell, Forsyth, Flowery Branch, Buford, Cumming, Hamilton Mill, Cheatu Elan, Winder, Gainesville, Hart County, Dunwoody, Grayson, Alpharetta, Dunwoody, Sandy Springs and Tucker as an Award Winning CPA.

This entry was posted on Sunday, July 29th, 2012 at 5:40 pm and is filed under Business/Tax Consulting, Financial Planning, Business Loans & Money Management, Incorporating in Georgia & Entity Selection.
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