Greetings!Im going to file my Articles of Incorporation soon. I plan on creating a Class S corporation. However, the tax portions still seem to baffle me.I understand how Class S corporations are tax transparent so no corporate taxes are required due to the fact that all profits are sent directly to the shareholders and marked on their personal income tax returns.Despite this, the literature I have read seems to distinguish between marking business income and salary on personal tax returns. Ive had little experience with taxes, especially when it comes to taxes on corporate profits.Can anyone give me the distinction?
      Answer1:Business Income would be the income that the business makes. Since you are making your own Corp. its assumed that you will then give yourself a salary, which would be your own personal income.When you have a Corporation, its treated as a separate entity, so you have to track its income and expenses, as well as your own.
      Answer2:The difference is simple.In a job, you dont have a choice. You get not what you are but what they say they can pay. Doesnt matter how great you are. You get paid on the work not your quality etc.Plus, the wages are linear income. You go to work, you get paid end of the months, and you pay your bills, etc. Then you got to do that all over again, for forty years of your life. Its a linear income.You cant say for "I have to catch bus, or drive a car and put petrol in, so I like to have tax deducations. You cant say, "I use my house, room, gas, electric for job and have some tax deductions because they are expenses."Thats why having a business especially a home business, is favoured by the system.Now...business..Income from business can grow and has no limit. It can multiply as well to multiple streams of income.It can also be tax deductable on. Such as your expenses for business, travel. If it is home business then you can also get deducations on bills too.I vouch for home business than working wage because of the tax benefits it can give.
      Answer3:Search: Business Empire Magazine (wont let me put link)they have a ton of useful information about starting, growing or finding good business opportunities. We use it for a class in my college entrepreneurship program