You’ve spent years building up your C corporation business into a successful operation. But how can you take more cash out of the company now without facing a tax disaster? Generally, corporate profits are subject to tax twice—once at the corporate level and once at the personal level when they are paid as dividends.
Fortunately, the double-taxation threat isn’t as dire as it seems. This Special Report features five tax-advantaged ways to pull cash out of your company—all perfectly legal!
Strategy 1: Fine-tune taxable income
Back in the day, it usually made sense to zero out your company’s taxable income for the year (i.e., reduce it to its lowest possible amount) via deductible payments for compensation and benefits provided to you. That way, you minimized the impact of double taxation.
Of course, any extra compensation received is subject to federal income tax at rates up to 35 percent, plus employment taxes. (For 2006, yo...(register to read more)