Maybe you own a Corporation and are wondering what tax deductions are available for your company. You came to the perfect place continue reading to discover. First virtually all tax deductions that other business entities accept are available to corporations. And if you are currently looking for a collection of business expenses that are deductible, a fantastic place to begin is the S corporation income tax return. Things like officer compensation, worker wages and salaries, repairs, maintenance, bad debts, rents, taxes, licenses, interest, depreciation, depletion, advertising, pension plans, and employee benefits.
Then you should be music to your tax-deducting ears: additional deductions. This is where you can deduct numerous necessary and ordinary business expenses which are typical. You can think off the top such as entertainment, utilities, travel, meals, phone, internet access, site hosting, and score of others. The point here is common business tax questions are reducing the virtual expenses that are operational.
Now to get a little news: There is a kind of expense that does require treatment for S corporations – fringe benefits throughout the year at any time. These fringe benefits include items like health insurance premiums such as dental, vision, hospital and injury, long-term care premiums, business contributions to health savings accounts disability premiums and group-term life insurance premiums. For benefits they need to be included in the shareholder W-2 income that was taxable. Broadly, because the addition in shareholder income offsets the deduction of the corporation, the tax advantage is eliminated.
And for some great news. There are number of fringe benefits. This listing includes facilities assistance, dependent care assistance, retirement planning services, employee discounts, de minimize fringe benefits and retirement plan contributions. This means these are not contained more-than-2% shareholder W-2 earnings. The company takes the employee and the deduction obtains advantage as income that is tax-free. It does not get any better than that. The bottom line on S Corporation deductions is not deductible by your enterprise.
There are tax deductions and tax reduction strategies available. If a sole proprietor can deduct medical insurance premiums profit. So for those who have a loss on Schedule, you do not have to deduct your premiums and it is lost. Your benefit is less than your insurance price, although for those who get a gain, the excess of premium over gain is a deduction that is. Insurance can be deducted by corporation. Another instance would be a corporation tax savings. In a sole proprietorship, all gain is subject to SE tax. In a corporation, only the salary paid to the shareholder/employee would be subject to payroll taxes any gain reported on Schedule K-1 legally avoids payroll tax.