New Tax Plan - incorporate?

[Paisley777]

So, with work travel expenses and other expenses nixed in the new tax plan - has anyone looked into incorporating?

 

[Canine]

I don't make near enough to itemize or to come close to breaking even setting up any kind of corporation. Since the standard deduction is nearly doubling (for single) from $6,350 to $12,000 next year, that makes incorporating even less inviting to me.

 

[Paisley777]

For those who itemize using their traveling job, this can be a problem. Some estimates have them paying 1k+ next year. (have to find the article again).

 

[Van-Tramp]

There would be no reason to INC. If your own Corporation paid you any money, then it would have to not only still pay Corp taxes on those "earnings" but also SSI and other taxes. Then you, personally, still need top pay personal taxes on that money.

All you would do is pay twice as much in taxes.

 

[sushidog]

A corporation is an effective tax strategy that allows you to convert personal expenses to business expenses. So instead of you owning and maintaining an asset, the corporation does. For instance, when you stop for gas, you charge it on a corporate credit card. Need an oil change, the corporation pays for that too, as well as insurance, registration, etc. The corporation pays for and depreciates your computer (used for business purposes) vehicle, business cell phone, wifi, etc. There's no need for the corporation to show a profit for several years, and when it does, it could just be a small profit, to avoid the double taxation. The biggest downside of a corporation is that it has to be documented properly, incurring legal fees and expenses to insure this is done, along with documented board meetings, etc. It also has to be conducted as a business, operated with an intent to make a profit, or it may be considered as a hobby and all tax savings disallowed by the IRS. You should always consult a tax attorney and an accountant for advice on this matter. Don't take mine or anyone else's on an internet forum.

Chip

 

[Canine]

Incorporating in Montana is one way to set up legal residence to have a driver's license, to have passport, to take advantage of inexpensive vehicle registration and insurance. You can also register and insure flatbed trucks and one ton vehicles for individual people- you don't have to register it commercially. MT has income tax, though MT is easy to get a CCW permit and is fighting the REAL ID, so if you're politically inclined toward things like that and feel strongly about it, that is another plus. If you were to incorporate somewhere, there are a number of advantages/disadvantages that need to be weighed holistically for your individual wants and needs not just financially.

 

[Paisley777]

I'm a film costumer & beginning traveling poker dealer. Both of these professions use the removed deductions extensively - mileage (a lot!), vehicle maintenance, hotels, uniforms, supplies, dues.... etc. It's looking like an average loss for film crew is in the neighborhood of $1000 (taking into account the increased std deduction)

I'll speak to a professional, of course, but I was just wondering how many in this group also really use those lost deductions and was looking into the incorp option to get them back.