C-Corp Tax Returns in Las Vegas, NV

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A C Corporation is a legal entity which is taxed separately from its shareholders. A common structure for many large Corporations, a C Corp has different advantages those of an S Corporation or LLC.

Benefits of C Corporations

  • Lower risk of audit.
  • Owners and shareholders face limited liability.
  • No restrictions on shareholding.
  • Easily transferable funds.
  • Additional tax benefits and deductions.
  • Ability to offer stock options
  • Easier to attract investors.
  • Charitable donations can reduce taxable income
  • Massive income possibilities if you go public.

In some cases, a small business can benefit from C Corp status. It is wise to review all business entity options with a trusted EA, CPA or Tax Attorney when setting up a business. Then on an annual basis, the EA or CPA can advise you if a change in entity might be to your advantage. At Torchlight Tax, this is part of our annual service.

How Are C Corporations Taxed?

A C Corporations is taxed on the net profit of the corporation. This can lead to double taxation for shareholders, as they are also subject to taxation on their distributions from the C corporation.

Avoiding Double Taxation

Of course, this means if you spend all the gross profit on tax-deductible expenses (including payroll), then the net profit is zero and the corporate tax is zero This avoids double taxation. Also, unlike LLCs and S Corporations, a C-Corporation can take a certain percentage (depending on the year) of its gross profits as charitable donations and thereby reduce its taxable income and resulting tax.

Then again, if a C-Corporation does not make any distribution to its shareholders (and instead leaves the money in the corporation) this also avoids double taxation, at least for a time, as there is no taxable income to the shareholders.

Creating a Corp to Accumulate Assets Tax Free

One could start a C Corporation on the side while living off the income of a job. Each year, one could take no distribution from the corporation. The corporation would be taxed at the corporate rate (21%) on its profits which might be lower than your personal tax rate. One could even zero out the corporate profit by buying (for example) business equipment and advertising and build the gross receipts and assets of the corporation while legally avoiding taxes. This only works if you do not need theprofit from the corporation to live on.

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    When doing current taxes, we often come across missed tax savings from prior years. When this happens, the Internal Revenue Service allows you to amend your taxes and lower your tax liability. Whether you or your prior tax preparer missed a W-2 or 1099, a revised 1099. large charitable donations, or made some other error, amending your tax return can help you recover the money you are rightfully owed. When we find this situation, we will advise you on potential savings and amend the previously filed tax return.

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