Quote:
Originally Posted by woj
What's the advantage of keeping $$ in the corporation? If the corporation would ever need the funds, the owner can always just lend it back to the corporation at any time...
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It's not about leaving the money in the Corp... That's more about building it up to a safety point. Bad luck, down eco, major lawsuits, the general unknown but expected business stuff.
Fund wise... If you take the money, it's taxed. if you give it to the Corp, it has a debt to you or you lose the money. One way or another, it's a loss. In the reverse, you could have invested the money, delayed the tax, possibly increased the pool of money, and pulled it when needed. Or if you're doing it to grow business, you could have done a loan to share holder or to the new corp, giving it a debt to start with - passing some tax relief down the chain - without costing you personally.