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2220 Corp Bencor Fica Form

2220 Corp Bencor Fica Form

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all right so how do s-corp taxes work well first we're going to have to go through how the S Corp actually saves tax versus a sole proprietorship or partnership and then we can go through how that actually ends up on your tax return all right so to first start off our handy spreadsheet here we're going to go through an example this is a sole proprietorship or partnership right has sales expenses profit that profit is what we're subject to tax here now if we're a sole proper partnership that hundred thousand dollars will be subject to 15.3 percent FICA taxes the Social Security Medicare tax so it's fifteen thousand three hundred dollars just for Social Security Medicare tax in this example that is in addition to ordinary income tax rates which are the tax brackets like 10 12 22 24 Etc with the feds now if we compare this to an S corporation the profit of an S corporation is not subject to that 15.3 percent FICA tax but there's a catch of c

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