<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> <HTML xmlns="http://www.w3.org/TR/REC-html40" xmlns:v = "urn:schemas-microsoft-com:vml" xmlns:o = "urn:schemas-microsoft-com:office:office" xmlns:w = "urn:schemas-microsoft-com:office:word" xmlns:st1 = "urn:schemas-microsoft-com:office:smarttags"><HEAD> <META http-equiv=Content-Type content="text/html; charset=iso-8859-1"> <META content="MSHTML 6.00.6000.16527" name=GENERATOR><o:SmartTagType name="PostalCode" namespaceuri="urn:schemas-microsoft-com:office:smarttags"></o:SmartTagType><o:SmartTagType name="State" namespaceuri="urn:schemas-microsoft-com:office:smarttags"></o:SmartTagType><o:SmartTagType name="City" namespaceuri="urn:schemas-microsoft-com:office:smarttags"></o:SmartTagType><o:SmartTagType name="place" namespaceuri="urn:schemas-microsoft-com:office:smarttags"></o:SmartTagType><o:SmartTagType name="PersonName" namespaceuri="urn:schemas-microsoft-com:office:smarttags"></o:SmartTagType> <STYLE>  </STYLE> </HEAD> <BODY lang=EN-US vLink=blue link=blue bgColor=#ffffff> <DIV><FONT face=Arial size=2>Dean,</FONT></DIV> <DIV><FONT face=Arial size=2></FONT> </DIV> <DIV><FONT face=Arial size=2>Very interesting.  </FONT></DIV> <DIV><FONT face=Arial size=2></FONT> </DIV> <DIV><FONT face=Arial size=2>But would that have an impact your social security payout at retirement?</FONT></DIV> <DIV><FONT face=Arial size=2></FONT> </DIV> <DIV><FONT face=Arial size=2>David Weiss</FONT></DIV> <DIV> </DIV> <DIV><B>From:</B> <A title=deanmay@pianorebuilders.com href="mailto:deanmay@pianorebuilders.com">Dean May</A> </DIV> <BLOCKQUOTE dir=ltr style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px"> <DIV style="FONT: 10pt arial"><B>To:</B> <A title=pianotech@ptg.org href="mailto:pianotech@ptg.org">'Pianotech List'</A> </DIV> <DIV style="FONT: 10pt arial"><B>Sent:</B> Sunday, October 07, 2007 8:50 AM</DIV> <DIV style="FONT: 10pt arial"><B>Subject:</B> RE: Self-employed techs</DIV> <DIV><BR></DIV> <DIV class=Section1> <P class=MsoNormal><FONT face=Arial color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">One of the biggest benefits of S corp is reduction of self employment tax. Under S corp you hire yourself to do the work. You pay yourself a nominal salary that is subject to normal withholdings- including FICA and the employers share, which amounts to the same as the 15% self employment. The bonus is that you as the owner/majority share holder get to pay yourself dividends off the company’s profits. These dividends are treated like interest income and are only subject to ordinary income tax; they not subject to FICA taxes. <o:p></o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face=Arial color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face=Arial color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">For example, if your business nets $75k per year and you are sole proprietor, you pay 15% off the top for self-employment which is over $11k. Under S corp you could hire yourself for a technician salary of say $25k per year (you make up a “reasonable” number here) and pay the remaining $50k out as dividends. You only pay the FICA taxes on the $25k. This would save you $7500 per year in self employment taxes.<o:p></o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face=Arial color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face=Arial color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial">There may be other benefits and/or liabilities. Check with your tax consultant. <o:p></o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face=Arial color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy; FONT-FAMILY: Arial"><o:p> </o:p></SPAN></FONT></P> <DIV> <P class=MsoAutoSig><B><FONT face="Bradley Hand ITC" color=navy size=6><SPAN style="FONT-WEIGHT: bold; FONT-SIZE: 22pt; COLOR: navy; FONT-FAMILY: 'Bradley Hand ITC'">Dean</SPAN></FONT></B><FONT color=navy><SPAN style="COLOR: navy"><o:p></o:p></SPAN></FONT></P> <P class=MsoAutoSig style="MARGIN: 0in 0in 0pt"><U1:PERSONNAME u2:st="on"><FONT face="Times New Roman" color=navy size=3><SPAN style="FONT-SIZE: 12pt; COLOR: navy">Dean May</U1:PERSONNAME>             cell 812.239.3359 <o:p></o:p></SPAN></FONT></P> <P class=MsoAutoSig style="MARGIN: 0in 0in 0pt"><FONT face="Times New Roman" color=navy size=3><SPAN style="FONT-SIZE: 12pt; COLOR: navy">PianoRebuilders.com   812.235.5272 <o:p></o:p></SPAN></FONT></P> <P class=MsoAutoSig style="MARGIN: 0in 0in 0pt"><U1:PLACE u2:st="on"><U1:CITY u2:st="on"><st1:place w:st="on"><st1:City w:st="on"><FONT face="Times New Roman" color=navy size=3><SPAN style="FONT-SIZE: 12pt; COLOR: navy">Terre Haute</SPAN></FONT></st1:City><FONT color=navy><SPAN style="COLOR: navy"></U1:CITY> <U1:STATE u2:st="on"><st1:State w:st="on">IN</U1:STATE></st1:State>  <U1:POSTALCODE u2:st="on"><st1:PostalCode w:st="on">47802</U1:POSTALCODE></st1:PostalCode></SPAN></FONT></st1:place></U1:PLACE><o:p></o:p></P></DIV> <DIV> <DIV class=MsoNormal style="TEXT-ALIGN: center" align=center><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt"> <HR tabIndex=-1 align=center width="100%" SIZE=2> </SPAN></FONT></DIV> <P class=MsoNormal><B><FONT face=Tahoma size=2><SPAN style="FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Tahoma">From:</SPAN></FONT></B><FONT face=Tahoma size=2><SPAN style="FONT-SIZE: 10pt; FONT-FAMILY: Tahoma"> pianotech-bounces@ptg.org [mailto:pianotech-bounces@ptg.org] <B><SPAN style="FONT-WEIGHT: bold">On Behalf Of </SPAN></B>Greg Newell<BR><B><SPAN style="FONT-WEIGHT: bold">Sent:</SPAN></B> Saturday, October 06, 2007 10:20 PM<BR><B><SPAN style="FONT-WEIGHT: bold">To:</SPAN></B> <st1:PersonName w:st="on">Pianotech List</st1:PersonName><BR><B><SPAN style="FONT-WEIGHT: bold">Subject:</SPAN></B> RE: Self-employed techs</SPAN></FONT><o:p></o:p></P></DIV> <P class=MsoNormal><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt"><o:p> </o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt"><BR>David,<X-TAB>  <BR></X-TAB><X-TAB>        </X-TAB>A year or two ago I switched from Sole Proprietor , which I was for almost 20 years, to a LLC. It was explained to me that I needed some protection against law suits etc. Recently I reunited with my cousin who just happens to be an excellent book keeper. She insists that she will be able to put a great deal of money back in my pocket by switching me to a sub S Corp. I don't pretend to know anything about it and strangely enough, I'm quite ok with that. I'll let her figure out all that stuff and I'll try to keep doing what I do and just maybe it'll work out in the end. Or maybe I'll be busy enough not to notice anyway.<BR><BR>all the best,<BR>Greg Newell <BR><BR><BR><BR>At 10:25 AM 10/6/2007, you wrote:<BR><BR><o:p></o:p></SPAN></FONT></P> <P class=MsoNormal><FONT face="Times New Roman" color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy">Has anyone explored the differences between forming an LLC and an S Corporation and the benefits of going that route as opposed to a simple sole proprietorship?  <BR> <BR>If anyone can direct me to good literature or share their own experiences on the subject, I’d appreciate it.<BR> <BR></SPAN></FONT><BR><FONT color=navy size=2><SPAN style="FONT-SIZE: 10pt; COLOR: navy">David Love<BR>davidlovepianos@comcast.net<BR><A href="http://www.davidlovepianos.com/" eudora="autourl">www.davidlovepianos.com</A></SPAN></FONT><FONT color=navy><SPAN style="COLOR: navy"> <BR></SPAN></FONT> <o:p></o:p></P> <P></X-SIGSEP><FONT face="Times New Roman" size=3><SPAN style="FONT-SIZE: 12pt"><X-SIGSEP>Greg Newell<BR>Greg's Piano Forté<BR><A href="http://www.gregspianoforte.com/" eudora="autourl">www.gregspianoforte.com<BR></A>216-226-3791 (office)<BR>216-470-8634 (mobile)<BR><BR>2003,04,05 & 06 winners of <BR>Angie's List Super Service Award<o:p></o:p></SPAN></FONT></P></DIV></BLOCKQUOTE></BODY></HTML>