014 - jonathan bander

this week i interviewed certified public accountant, jonathan bander. he is part of rich and bander cpa's with over 500 clients, offices accross the country, and nearly 15 years in the business. during our call we discussed the pros and cons of the setting up a legal business entity. we discussed the llc, s-corp, and c-corp. the popular choices by most all people.

in a nutshell:

s-corp //

pros:
less subject to audit
potential tax savings
great for single owners and among people with equal capital/interests
will benefit from new tax code 20% income deduction

cons:
not great for people that have unequitable interests/capital
can only be owned by usa residents or citizens with ss #
max 100 owners – only people, no companies can own s-corps

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llc //

pros:
flexible! it can be taxed as any other entity type (partnership, corporation, s-corporation).
can be owned by any type person or entity.
profit, loss and capital can be determined independently.
will benefit from new tax code 20% income deduction

cons:
single member llc is high audit risk.
subject to self-employment tax on all earnings.

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c-corporation //

pros:
new irs tax rate is max 21%!
lowest audited entity type.
can be owned by anything/anyone.
preferred type by investors.

cons:
double taxation!

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we also discussed a few highlights of the new tax plan:
1. - pass-through income deduction of 20% (mentioned above).
2. - additional depreciation allowances for 2018.
3. - change to like-kind exchange (which effects the cryptomarket).
4. - new non-deductible meals and entertainment rule.
5. - estimated taxes, the requirement to pay, penalties for underpayment, and how to potentially reduce penalties for late payments of estimated taxes through the annualization of income method (form 2210).

jonathan is willing and happy to answer your questions, for free, via email: jon@richandbander.com

you can also reach him at (212) 684-2470.
learn more about rich & bander cpa's at www.richandbander.com