Is your LLC costing you money? with Salim Omar, CPA

[00:01 - 05:47] Opening Segment

• Welcoming Rod back to the show
• What is an LLC?
• Two advantages of an S Corp: tax savings and retirement savings
• An LLC is a pass-through entity
  • It does not pay the tax, everything flows back to the individual
  • How you are taxed on both sides with an LLC

[05:48 - 11:54] Maximize Your Tax Savings and Retirement Savings

• S Corp explained
  • It is not considered self-employment
  • The owner is deemed as an employee and draws a reasonable wage
• How an S Corp could save you dollars: breaking down the math
• There are a lot of retirement vehicles that are not available for a self-employed individual

[11:55 - 16:00] Switching From LLC to S Corp and Vice Versa

• How to convert an LLC to an S Corp
  • Two forms are needed on the federal level: Forms 8832 and 2553
  • Consult a tax professional to avoid costly mistakes
• Filing a revocation of S Corp election
  • Consider carefully because there is a 5 year cooling off period 

[16:01 - 17:11] Closing Segment

• Connect with Rod on the links below

Need an expert’s help with taxes? Connect with Rod on LinkedIn, head over to https://www.straighttalkcpas.com, or email him at [email protected].

LIKE THE EPISODE?

Please give us a 5-STAR REVIEW. Don’t forget to LIKE, SHARE, and SUBSCRIBE.

Don’t forget to tune in to the next one! 

Tweetable Quotes

“The uniqueness of an S Corporation profit is that it is not considered self-employment income by both the IRS and most state so that profit is not taxed that 15.3%.” - Rodney Deloe, CPA

“Do a quick survey, find out what a person doing your job in a regular business would earn, and you can use that as at least an initial baseline for what the IRS would deem as reasonable wages.” - Rodney Deloe, CPA