Dont pay taxes

[HackElectric]

The point is that there is a basic misunderstanding about what an S-Corp is. It has nothing to do with anything on the state level or what type of corporation it is. it is only about an election a business owner is allowed to make on how the profits are taxed for federal income tax purposes. Has nothing whatsoever to do with anything else.

It has nothing to do with my post, in which you quoted, asked a question of me, and then told me I was misunderstanding something.

What you are speaking about has nothing to do with the discussion at hand, if you just want to show everyone that you know more than them, don't quote a particular post.

 

[infinity]

petersonra, You're the one with the misunderstanding.

The discussion was about corporations in NJ and the owner being required to carry WC on himself.

My question was whether the owner of an LLC who filed as an S-Corp would be require by the state to carry WC.

That's true in New Jersey, form an LLC with zero employees then no workers comp insurance required. Form an S corp, also with zero employees, and you'll have to shell out a few thousand a year for WCI. I only brought this up because it was germane to the OP and about not always saving money.

 

[petersonra]

That's true in New Jersey, form an LLC with zero employees then no workers comp insurance required. Form an S corp, also with zero employees, and you'll have to shell out a few thousand a year for WCI. I only brought this up because it was germane to the OP and about not always saving money.

how does electing sub chapter S status with the IRS have anything to do with paying WCI in NJ?

 

[infinity]

In NJ you incorporate with the State as one of several different corporations, partnerships or sole proprietorship. If you're a corp you pay WCI even if you and the other officer in the corporation are the owners and the only workers. Also as a corporation you pay an annual $500 corporation fee to the State.

[h=3]Who Must Insure?
[/h]

The following employing entities must have workers' compensation insurance in effect:

Corporations ? All corporations operating in New Jersey must maintain workers' compensation insurance or be approved for self-insurance so long as any one or more individuals, including corporate officers, perform services for the corporation for prior, current or anticipated financial consideration *.

Partnerships/LLC's ? All partnerships and limited liability companies (LLC's) operating in New Jersey must maintain workers' compensation insurance or be approved for self-insurance so long as any one or more individuals, excluding partners or members of the LLC, perform services for the partnership or LLC, for prior, current or anticipated financial consideration*.

Sole Proprietorship ? All sole proprietorships operating in New Jersey must maintain workers' compensation insurance or be approved for self-insurance so long as any one or more individuals, excluding the principal owner, performs services for the business for prior, current or anticipated financial consideration*.

​

http://lwd.dol.state.nj.us/labor/wc/employer/require/insure_index.html

 

[HackElectric]

So going by that info, as an LLC I wouldn't need WC even if I filed as an S-Corp. Thanks Infinity.

 

[electrofelon]

hm. thank you very much for this. i will look further.
it may be something worth having, as you have pointed out.

the hook in this state is that i can be sued personally for any
install i do with my own hands, and i don't know how a LLC
would get around that, but i'm willing to take the time to find
out...

thanks again.

Just to reiterate an important point that I may not have been specific on, If you are looking for maximum tax benefits, its really important to find the right accountant. I have found that having an LLc itself doesnt really automatically save you money. With the previous accnt I had, I generally paid around $3500 per year but havent had any tax liability since switching to Schlather and Birch. Like I said, Bob Schlather is both an attorney and a CPA so i think he really knows how to set it up and work it. Also keep in mind there are some disadvantages to not paying income taxes, and that is you are not contributing much to SS which you may or may not care about. Also you will not show much income which could reduce your ability to get a loan, etc.

 

[__dan]

Just to reiterate an important point that I may not have been specific on, If you are looking for maximum tax benefits, its really important to find the right accountant. I have found that having an LLc itself doesnt really automatically save you money. With the previous accnt I had, I generally paid around $3500 per year but havent had any tax liability since switching to Schlather and Birch. Like I said, Bob Schlather is both an attorney and a CPA so i think he really knows how to set it up and work it. Also keep in mind there are some disadvantages to not paying income taxes, and that is you are not contributing much to SS which you may or may not care about. Also you will not show much income which could reduce your ability to get a loan, etc.

Having done both the sole proprietor and C corp, I know less about it now than I did in 1985 (they keep changing the rules faster than I could forget them).

There is absolutely a case to be made for maxing out your Soc Sec as it is all most people will have, after the stealing everything else you own is done. I actually know people who got to the end and did not have their Soc Sec. and had everything else stolen.

When I went C corp my expenses ballooned up out of sight to the point were I could no longer afford to work for most people (it became too expensive to work for nothing). I still don't know the why's or how's of it as I was fighting so many crooks at the same time. All at the same time or stand in line one at a time, makes no difference to me. Guess I accidentally fell into the sausage making machine as I was touring the plant. Had no interest in joining the crooks and becoming that.

$3500 is peanuts and probably all Soc Sec with a near zero remaining taxable income.