Solos - have to pay Self Employment tax?
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Date: April 14th, 2014 9:51 PM Author: bearded theater stage
-Elect S-corporation status
-pay yourself a "reasonable" salary and pay employment taxes on that (roughly equal to self employment tax + around $300/yr in state and federal unemployment taxes)
-Set the "reasonable" salary to around 40-50% of your net profit
-take the other 50-60% as distributions, which are not subject to any kind of employment taxes (only personal income tax)
(http://www.autoadmit.com/thread.php?thread_id=2543627&forum_id=2#25384405) |
Date: April 14th, 2014 10:42 PM Author: Aphrodisiac Roast Beef
How does this affect retirement planning?
Doesn't a lower salary reduce your social security payout?
I've never had any reason to run the numbers to see what happens.
(http://www.autoadmit.com/thread.php?thread_id=2543627&forum_id=2#25384825) |
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