I know some realtors who are P.A.s, that's why I was asking. I was pretty sure that it is only for liability/asset protection, but didn't know if there were any tax implications or benefits.

 

P.A. is a "Professional Association" or corporation that restricts stock ownership to licensed professionals such as attorneys, CPAs, doctors, etc. I've seen it used by realtors as well. The corporation is a separate tax paying entity unless it elects S corporation status. The S corporation election and tax treatment could provide some tax benefits but this is a tricky area of tax law. IMHO, I do not believe it offers any significant tax advantages and there are other simpler, less costly alternatives.

 

well under the Scorp you can get around paying good portion of SE tax/FICA through profit distributions. Which is 15.3% of savings. pretty big you just have to make sure they pay themselve a reasonable wage. However there are some cost to the savings quarterly filings for 941, UCT-6 and payments for your 940. You just have to make sure the benefit out weighs the cost.

I would say LLCs are more complicated then Scorps unless its a single member LLC.

 

I feel a tax debate brewing.....BRING IT RON.LOL JK.............You would kick my *** in tax knowledge. I lack much needed experience. But soon i will be a master Jedi CPA.

 

Lets not bring up Foreign Sales Corporations or Domestic International Sales Corporation.

 

Well this tax debate went nowhere fast.

 

RON is just Scurred.

 

Damn i thought Ron would think this is funny i guess im wrong.

 

You better have a good basis upon which to justify a "reasonable compensation" of anything less than the maximum social security wage base. It's not a fight I would want to have with the IRS unless you have very compelling industry data to support your position.

LLCs are NOT more complicated than corporations.

Okay, enough tax talk.............now for some fun tomorrow.

 

naturally