It’s a fact. Your S Corporation may not give you the tax-free fringe benefits you want. In the good old days, the S Corporation avoided double taxation, reduced self-employment taxes, and also gave you a bunch of fringe benefits.
Well, sadly, the good old days are long gone (since 1982). Which means that when the S Corporation is your 2011 business entity of choice, you have to face giving up some fringe benefits. What can you do about this situation? You’ll find specific answers in our latest article titled Tax Tips for the S Corporation’s Fringe Benefit Realization.
Four ways our fact-filled article can help you:
- We’ll explain the 2 percent shareholder problem. The law taxes any fringe benefits received by employees who own a greater-than-2-percent interest in an S Corporation as if they were partners in a partnership. Tax law limits the fringe benefits that are available to partners. Thus, the S Corporation can have two types of employees. We’ll explain who they are when you read the full article.
- We’ll explain which fringe benefits are lost. The S corporation may not provide the more-than-2 percent owner/employee with four kinds of tax-free fringe benefits. We’ll tell you what they are when you read the full article.
- We’ll list the “no problem” fringe benefits. All the news isn’t bad. We’ll list the ten fringe benefits that ARE available to the more-than-2 percent owner/employee. Get the whole story when you read the full article.
- Three strategies for handling the owner’s disallowed fringe benefits. We spell them out and, believe me, you shouldn’t miss them. Important information is waiting for you when you read the full article.