LLCs and S Corps More Attractive Due to Changes in Tax Code
With the Tax Cuts and Jobs Act a new deduction for pass-through business income was created (LLC, S Corp, Partnership and Sole Proprietorship income). The deduction allows for a 20% deduction of qualified business income. There are a few limitations, but in general this means that 20% of business net income can be a deduction on the owner’s personal tax return. *
Before the Tax Cuts and Jobs Act a C Corporation had a range of tax rates between 15% and 35%. After the Tax Cuts and Jobs Act the corporate rate is now a flat 21%. For most large corporations this is a win with a lower tax bracket, but if you were operating as a C Corporation with net profits less than $50,000 this is an increase of 6%.
For this reason we are seeing:
- An increase in the Formation of LLCs (Liability protection; lower fees overall; less paperwork).
- An increase in new Corporations electing S Corp status
- Existing Corporations making elections from C Corp to S Corp status with the IRS
Sole Proprietorships are not recommended in an asset protection strategy. With a Sole Proprietorship there is no protection for personal or business assets.
Why use a Wyoming LLC?
- Wyoming was the birth state of the LLC so it has the longest statutory history
- Enhanced protection for Members, including single-Member LLCs
- At this time Wyoming does not require that you name Managers or Members on Articles or Annual Reports
- Annual Report fee is only $50 if there are no assets located in Wyoming
- No corporate tax or personal income tax
- Minimal paperwork required
- Wyoming has a chancery court
* PLEASE NOTE: There are a few limitations to the Qualified Business Income deduction such as W-2 wage limitation; service business limitation and higher income level limitation. Please seek advice from YOUR tax professional for your specific situation/goals.
Some information contributed by Elite Bookkeeping & Tax Services.
If you are doing business in another state, we can help you register there. Call us today at (800) 891-5987.
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FOR OUR VALUED CLIENTS AND FRIENDS
December is THE busiest time of year for new entity filings. Don’t miss out on our winter promotions.
OPTION 1: $50 OFF new Wyoming Corporation or LLC Package (excluding Basic Pkg) plus FREE Record Keeping Forms on flash drive ($99 value). TOTAL SAVINGS: $149
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WE’VE EXTENDED EXPIRATION TO 2/28/2019
What’s Next After You Incorporate?
If you just incorporated in Wyoming, or are doing some preliminary research, below are some helpful links to guide you. We encourage you to call us at any time if you have any questions or if you need assistance.
Videos regarding obtaining an EIN, Banking, Taxes, etc.
https://aaacorpservices.com/videos-2/
Why Did You Incorporate- for Asset Protection, Tax Savings or both?
The number one reason people incorporate is for asset protection. However, nearly 60% of businesses are in jeopardy of having their
corporate veil pierced because they do not have a Corporate Record Book and are not maintaining corporate records. Read about how this can effect your business.
https://aaacorpservices.com/what-we-offer/services/corporate-record-keeping/
Establishing a Presence and Building Your Business
We understand the importance of asset protection and putting your money to work for you. Read about our Executive Suite Program, which will help you establish a Wyoming presence and how we can help you build your business with sales support.
https://aaacorpservices.com/what-we-offer/services/
1099 vs. W2- What You Need to Know
http://elitebookkeeping.biz/1099-vs-w-2-what-you-need-to-know/
Tax Benefits of a Medical Reimbursement Plan
Your Corporation can provide you with many benefits. One that is often overlooked is a Medical Reimbursement Plan.
http://elitebookkeeping.biz/tax-benefits-of-medical-and-dental-reimbursement-plan/
Special Permits for your Wyoming Entity
Some frequently asked questions regarding permits, tax requirements, etc.
http://www.wyomingbusiness.org/program/business-permitting/2833
ADDITIONAL LINKS:
Elite Bookkeeping & Tax Services
http://www.elitebookkeeping.biz
Internal Revenue Service
http://www.irs.gov
Electronic Federal Tax Payment System (EFTPS)
https://www.eftps.gov/eftps/
Wyoming Department of Workforce Services
https://doe.state.wy.us/wyereg/
U.S. Social Security Administration
http://www.socialsecurity.gov
Government Services Administration
http://www.gsa.gov
Disclaimer: AAA Corporate Services, Inc. are not attorneys or accountants and we do not offer legal or accounting advice. If you need legal or accounting advice, you should contact an attorney or accountant. We do work with attorneys and accountants all over the U.S. If you would like for us to refer you to someone, please contact our office.
#1 For the 5th Year in a Row for Wyoming
In case you missed it, for the fifth year in a row Wyoming grabbed the top spot as the best place to do business according to the Tax Foundation’s 2017 State Business Climate Index.
According to a recent article by the Wyoming Business Council, “The Tax Foundation analyzes over 100 tax variables to determine a state’s ranking. “
Some of the reasons Wyoming received this ranking are:
- No corporate or individual tax
- A pro-business climate
- Low cost of doing business
- Low regulatory burden
START YOUR NEW WYOMING ENTITY TODAY!
To view our package options, use the links below:
As you’ll notice we also offer services to help establish a presence in Wyoming. If you’re ready to fully launch your business in Wyoming and would like to have our staff assist with fielding calls, handling your mail, etc., we recommend that you look at our Platinum Package.
For a description of our services CLICK HERE.
If you have any questions, give us a call at (800) 891-5987 or (307) 635-8700.
