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Comment: Re:First thing... (Score 1) 262

by BusinessHut (#26303505) Attached to: Getting Started With Part-Time Development Work?

You DO NOT need to incorporate. Of course there are benefits to doing so. Mostly just in protecting your personal assets. Many judges are even poking holes in this because so many people are incorporating simply for the protection. You can write off all of the same business taxes as a sole proprietor that you can as a corporation. Either way, they have to be business expenses.

For example...say I bill out and collect $100K a year. I pay myself a reasonable salary of say, $40K (some go lower than this). Now, I only have to pay SS and medicare on that $40K....the rest of the $60K is only subject to state/federal taxes.

It's important to note that you can't spend any of that $60k on personal expenses unless you "pay" it from your corporation to yourself. In which case you DO have to pay all applicable taxes and whatnot.

In summary...Take tax and business advice on Slashdot with a grain of salt. Write it down and take it to your actual professional lawyer, accountant, priest, etc... and get their advice. Those are expenses you must plan for if you'll be starting your own business.

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