GoFuckYourself.com - Adult Webmaster Forum - View Single Post - US Income tax breaks for higher incomes

Snake Doctor · 08-13-2005, 08:12 PM

Yeah the payroll tax break is a big one.
If you're an LLC you can pay yourself a salary of say 50K, on which you have to pay the 15.3% payroll tax (social security and medicare) and the rest of your money you can take as a "dividend" which is subject to income tax but not the payroll tax.

I save 9-10K a year in taxes being set up this way.

Also if you're an LLC you can set up a single person 401K and fund it with up to 40K per year tax free. (Check with your accountant for the exact number..I'm pretty sure it's in the 40K range)

All of the tax benefits out there these days are meant to encourage savings, so if you're looking for a way to make a bunch of cash to spend you're S.O.L. But if you're willing to save for the long term you can avoid a lot of taxes.

08-13-2005, 08:12 PM
Snake Doctor I'm Lenny2 Bitch Join Date: Mar 2001 Location: On top of my soapbox Posts: 13,449	Yeah the payroll tax break is a big one. If you're an LLC you can pay yourself a salary of say 50K, on which you have to pay the 15.3% payroll tax (social security and medicare) and the rest of your money you can take as a "dividend" which is subject to income tax but not the payroll tax. I save 9-10K a year in taxes being set up this way. Also if you're an LLC you can set up a single person 401K and fund it with up to 40K per year tax free. (Check with your accountant for the exact number..I'm pretty sure it's in the 40K range) All of the tax benefits out there these days are meant to encourage savings, so if you're looking for a way to make a bunch of cash to spend you're S.O.L. But if you're willing to save for the long term you can avoid a lot of taxes.