09/08/2026
I have given up trying to reach out to the "Corps pay no taxes" crowd - mainly because no matter how I try and explain passive, active, perferential, deferred, not allowable and pass through, what I most often get back is a plethora of media talking points - often from folks speaking from a point of bias.
It's important to remember that not all taxes are created equal and the bottom line on a tax return rarely tells the entire story.
How much F**A is being paid into the Social Security and Medicare coffers? How much property taxes are paid on the physical presence of the fixed assets - building, lands and equipment? How many jobs are being created by that business that keeps your neighbors employed? How many ancillary businesses benefit from other businesses in your city? Dry Cleaners, Donut Shops, Restaurants, plumbers, electricians and baby sitters all benefit and generate income from other businesses in your city. How about Excise, Transportation, Sales & Use, Employment taxes just to name a few of the many many taxes that we are all subject to that appear hidden. These are all taxes that are directly infused into your local economy - these are paying your child's teacher's salary, the firefighter and policeman there to protect you and your property. Very often, the true value of "big" business isn't Federal Income Tax but the value that those jobs bring to our local economy - you and I rarely feel the federal stuff but we live daily with the state and local political implications.
Do you own stock? Do you get a 1099DIV at year end? Are you including that on your tax return? Do you have stock in your investments or retirement accounts? Did you know that you are an owner of that business - if you own stock of a publicly traded business you are an owner of that business -- you own that stock to make money - you have a profit motive. When the business no longer makes a profit, you will most probably divest your interest by selling the stock to reinvest in something that will make you money. When you pay your taxes due April 15th - the honest truth is that that "Corp" just paid it's taxes. Dividends are paid out of performance and are NOT a business deduction for that business but a removal of cash - Generally corps can not hoard cash or they get hit with Accumulated Earnings Tax.
That was the tax preparer hat, now putting on the hat of a bookkeeper - what tax planning is happening in the day to day operation of a business, how are the books being processed and transactions being treated for the greatest advantage. Is your bookkeeper doing a Bank Account Analsys monthly to ensure that income ties out directly to the bank? This is NOT a bank reconciliation and is a very different system check. Are all transactions being verified to ensure that were they are posted in a way that is unarguably legal in an audit. If you have a bookkeeper who says that they don't know or worse knowing is not their job I would encourage you to do some digging and really get involved in your books - you don't know what you don't know until you are in audit and by then those audit trails tell a story that can't be walked back.
Just a reminder the piper always seems to get paid one way or another.............
