Tax Guru – Ker$tetter Letter

Q:

Subject: Thank you

 

Thank you for your great article. We were about to from an S corp because all professionals we meet advised us so. After reading your article, we changed our mind. My wife has an online business with gross income arround 70000 a year. It is basically a one man’s side job and we use our home as office. If we form a C Corp, do we still get the benefit of home office deduction such as mortgate, house repaire/maintanence, utility, etc? Perhaps, we can even use a more aggressive formula to take the benefit? It would be great if you could mention this in your article.

 

Regards,

A:

Leasing a home office to a C corp has long been a very easy way to pull money out of the corp without having to pay any of the payroll taxes that would be required for salaries and avoid the double taxation of dividends.

Any experienced tax pro who understands the power of using C corps can help you set up a good strategy to minimize your taxes via this and the several other similar techniques.

Good luck.

Kerry Kerstetter