Lately, with all of the buzz about potential tax changes that Congress and the White House have proposed, I have been getting a lot of questions from investors about entity structuring. Everyone wants to know if C Corporations will suddenly become the best entity structure for saving on taxes if the tax law lowers corporate tax rates. Although a potentially lowered tax rate does sound enticing, there are a few other reasons why C Corporations still may not be the best idea for investors. Let’s take a look at some of the details.
The most notorious criticism of C Corporations is double taxation. This is because C Corporations have their own tax rate, and taxes on net income earned in the business are paid by the corporation with corporation funds. In addition, if any money is taken out of the corporation by the investor, then they have to pay tax on that money as well on their personal returns with personal funds. Essentially, those funds are being taxed twice: once at the entity level when they are earned and again at the personal level when they are distributed as either dividends or payroll.
This is one of the reasons that pass-through entities are often viewed as better tax entities for investors. Instead of paying a corporate tax rate and then a personal tax rate, all of the earnings within the pass-through entity flow through to the personal tax returns where the taxes are paid. Subsequent dividends or distributions are not taxed separately again. They are essentially a tax-free transfer of funds.
For more than a century, home-ownership has come with a small bonus: The mortgage interest deduction. It allows borrowers to deduct the interest paid on their home loans from their income taxes. Real estate agents, home-builders and mortgage lenders have long used it as a selling point. Every so often it comes up in debate, but it is so popular that lawmakers are more than a little bit afraid to touch it. The future Trump administration apparently is not.
“We’ll cap the mortgage interest, but we’ll allow some deductibility,” said Steve Mnuchin on CNBC Wednesday after confirming that has been asked by President-elect Donald Trump to head the Treasury Department.
Greetings, everyone! Thanksgiving is a blessing in disguise. With your friends and family near, make this day as special as you can and thank them with your heart. May you have a wonderful time this season! Happy Thanksgiving!
The good weather’s on its way. Let’s fire it up!
Whether you’re a die-hard charcoal fan, or more of a “taste the meat not the heat” propane griller, I hope you enjoy these tips and recipes. One of the great joys of owning your own home is making a space for a little outdoor cooking. It can be hard to grill on an apartment balcony!
Beginning in January, several federal agencies are implementing new policies which are intended to address the lax underwriting standards that contributed to the housing crash more than five years ago.
For example, on Jan 10th, the Consumer Financial Protection Bureau will implement a new set of rules that were created to stem the predatory lending practices that are deemed responsible for the wave of foreclosures over the last five years.
We wish you and your family a very Merry Christmas that brings all the festive cheer and Happiness possible to make it a memorable time. Also, wishing you a Happy, Healthy and Prosperous New 2014 Year!
Property Management Company recognized for its Excellence in Property Management in Philadelphia, Bucks County and Montgomery County, Pennsylvania.
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PRLog (Press Release) - Oct. 18, 2013 - FREMONT, Calif. -- Fremont, California –Onyx Management Grouptop provider of property management services in Philadelphia, Pennsylvania proudly announced today that it received TReXGlobal’s 3R Award for being "Responsible, Reliable, and Recommended".
With summer coming to an end we are starting to prepare for a cold season. To help save energy and cost Onyx Management offers the following inspection and maintenance to be done at your properties. The cost for each inspection will be...
Landlords are likely to see a change soon in security deposit regulations, as a bill to clarify these rules moves toward final passage.
Under this proposed statewide law, landlords will be required to pay interest on security deposit funds, and to disclose to tenants where the funds are being held.
Additionally, the bill clarifies the rights of tenants to seek damages for wrongful withholding of deposits.