The US income tax system is a progressive tax system. The more you make, the more you are taxed! But remember, people can arrange their finances in ways to take advantage of any tax benefits. This does not mean that the tax laws don't apply to you! But, you can pay less tax by managing your finances in ways that minimize your tax liability.
Now Companies are also taxed, but they are taxed differently than people. When a person makes money, they are taxed on a portion of their total income. But, businesses are not taxed on income at all, but rather, they are taxed on "profit." Anything which is a "business expense" is not taxed. And there are hundreds of legal ways businesses can reduce their profit. This reduces tax on the corporation, and as the owner, ultimately you!!!
With over 50 years of experience we wanted to put out our top 5 business tax tips as we see these are often the most overlooked.
