#PTonICE Daily Show
Episode 1914 - Starting your own practice, pt. 3: S-corp election
Feb 13, 2025
Discover why the S-Corp election is a game changer for small business owners, especially in healthcare. The discussion unveils how this tax status can help avoid double taxation and reduce payroll tax obligations. Learn the essential steps to elect and maintain S-Corp status, ensuring your practice's financial structure remains optimized. Tune in for valuable insights that could save you money and streamline your business!
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Quick takeaways
- Electing S-Corp status helps small business owners avoid double taxation by treating income differently at corporate and personal levels.
- Understanding the S-Corp election process, including timely submission of IRS Form 2553, is crucial for maximizing tax benefits for new practices.
Deep dives
Understanding S Corp Election
S Corp election is a tax status rather than a different type of incorporation, providing crucial tax benefits for small business owners. It protects businesses from double taxation, wherein income is taxed at both corporate and personal levels. This means that without S Corp election, any earnings are taxed when the corporation generates profit and again when distributed to owners, significantly reducing net income. By electing S Corp status, small businesses can avoid this financial burden, making it a strategic move for nearly all small business owners, particularly in the rehabilitation field.
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