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Biggest Reform EVER passed thread

Timco has a Military and civilian side. All the thousands of employees are local. The military side is obviously controlled by American interests. There are numerous supply chain businessses on the periphery which also employ thousands.
Oh, I didnt know you cared about the employees. I say, for efficiencies sake, we just give the offset tax revenue directly to the employees, instead of making private jets cheaper for the rich.
 
The repatriation of corporate is an even bigger scam. That money goes to stock buy-backs and bonuses. People didn't get hired when W did it. They won't get hired now.

What's astonishing to me (but not really) is the inane, myopic, immediate greed overshadows the most basic tenet of a market based economy. The bigger the market the more money you make long-term. If mega/multi-national corporations paid their employees more, they would be able to buy more goods and service in an ongoing manner and thus grow these businesses.
 
 
Pretty huge loophole I ended up coming up with for self-employed/small business owners. (I'm sure tons others have as well, but I havent read an article on it yet) There's always been the temptation for not being paid W2 wages and instead taking profits to reduce FICA taxes, but at least there was a SS cap and over that the only difference was about 1.45% for medicare payments. (2.90% for the owners).

But now you get this like 7.4% tax deduction for business income that you don't get if you receive wages, so there's a real pressure for an owner of a small business who would otherwise make $300k in W2 wages to reduce their wages by alot, as they basically save 10.3% on taxes by reclassifying it as business profits. So now the IRS is going to have to spend all its time arguing on whether small business owners self-declared wages are appropriate.

Could not be a dumber idea
 
Pretty huge loophole I ended up coming up with for self-employed/small business owners. (I'm sure tons others have as well, but I havent read an article on it yet) There's always been the temptation for not being paid W2 wages and instead taking profits to reduce FICA taxes, but at least there was a SS cap and over that the only difference was about 1.45% for medicare payments. (2.90% for the owners).

But now you get this like 7.4% tax deduction for business income that you don't get if you receive wages, so there's a real pressure for an owner of a small business who would otherwise make $300k in W2 wages to reduce their wages by alot, as they basically save 10.3% on taxes by reclassifying it as business profits. So now the IRS is going to have to spend all its time arguing on whether small business owners self-declared wages are appropriate.

Could not be a dumber idea

File as a partnership and pay out all earnings as partnership profit allocations and not as guaranteed payments. The IRS has clarified that there is no reasonable wage requirement for partnerships and that only guaranteed payments would be considered wages. Then you can make sure all of your income is subject to the 20% deduction.

I am pretty sure there are anti-avoidance rules if you maintain S Corp status.

Schedule C filers don't pay themselves W-2 wages anyway.
 
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Wait for it, the trickle will start any day now.
 
File as a partnership and pay out all earnings as partnership profit allocations and not as guaranteed payments. The IRS has clarified that there is no reasonable wage requirement for partnerships and that only guaranteed payments would be considered wages. Then you can make sure all of your income is subject to the 20% deduction.

I am pretty sure there are anti-avoidance rules if you maintain S Corp status.

Schedule C filers don't pay themselves W-2 wages anyway.

the company I work for is an S-Corp, so if I'm reading your response correctly then I am subject to the anti-avoidance rules.

For my own knowledge, can a partnership be a single member (I.e. if I became a consultant?)
 
Also, since the deduction is limited if you don't have W2 wages, I'm not sure how much being a partnership will help.
 
Federal Deficit Jumps 17 Percent As Tax Cuts Eat Into Government Revenue


Shocking.

Who could’ve known this would happen?


The deficit typically grows during recessions — when tax receipts shrink and demand for food stamps and other government assistance rises — then falls during good times

The current spike in the deficit at a time of strong economic growth and low unemployment represents a break with that historical pattern.

The last time unemployment was this low — in 1969 — federal government ran a small surplus.

After peaking at nearly 10 percent of GDP in 2009, the deficit declined as share of the economy through 2015. It's been rising since, hitting 3.9 percent of GDP in the fiscal year just ended.
 
Also, since the deduction is limited if you don't have W2 wages, I'm not sure how much being a partnership will help.
The deduction is limited on wages only to excess income which is moot for a professional service provider anyway.
 
the company I work for is an S-Corp, so if I'm reading your response correctly then I am subject to the anti-avoidance rules.

For my own knowledge, can a partnership be a single member (I.e. if I became a consultant?)
Yes. A single member llc is default disregarded schedule c which qualifies for the credit too.
 
Yes. A single member llc is default disregarded schedule c which qualifies for the credit too.

Ok, let's put it simply. Say I'm married with $400k in wages (One can dream). Using $55k in 401k deferrals and $24k in standard deduction, you get under the $315k cap for professional service providers. What entity structure and W2 wages would I set to maximize the deduction and minimize FICA? Am a sole proprietor, but could easily find a partner in the same line of work.
 
I seem to remember, at the beginning of the year, that Republicans were bragging that the tax cuts would prove to be so popular that they would be a real asset to Republican candidates running the fall. Somehow, that doesn't seem to be the case, as Republicans have barely mentioned it thus far. Instead, it's all about cultural and social war issues, as usual.
 
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