IRS - The S Corporation Association

Is Official Washington Targeting S Corporations? Sure Looks That Way

As our readers know, the IRS is currently targeting S corporations, and only S corporations, for audits as part of its on-going “Tax Gap” research project. And the Joint Committee on Taxation and Treasury Inspector General for Tax Administration have, over the past couple year, proposed to dramatically increase the application of payroll taxes on S corporation income.

Now the Congressional Budget Office issues its new biannual “Budget Options” report, and there, on page 297 is an option entitled, “Repeal Tax-Free …

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admin2019-02-06T18:46:06+00:00February 26, 2007|

Rangel Ready to Prepare Small Business Tax

Good news for S corporations and other closely-held businesses! Ways and Means Chairman Charles Rangel (D-NY) indicated yesterday that he plans to put together a package of small business provisions to be coupled with the minimum wage increase that has already passed both the House and the Senate. This announcement reverses the previous position of the House leadership, who had indicated they wanted to send the President a “clean” minimum wage bill. As BNA reports:

House Ways and Means Committee Chairman Charles Rangel (D-N.Y.) said Feb. 6 that the House would put together …

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admin2019-02-06T18:46:06+00:00February 7, 2007|

Do S Corporations Pay the Minimum Wage?

Now that the Senate has adopted a package pairing the minimum wage together with provisions to improve S corporation rules, one of the questions our Capitol Hill friends have asked us is, “Do S corporations pay the minimum wage?” The answer is an emphatic yes. While there are no studies to our knowledge that directly track the payment of minimum wages by businesses structured as S corporations (to be sure, there is little economic data on wage levels period), a couple of items demonstrate that S corporations are more likely to be adversely impacted by an increase in the minimum …

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admin2019-02-06T18:46:06+00:00February 2, 2007|

Minimum Wage & Small Business Tax Package Update

Just a quick update on the status of the $8 billion small business tax package that may accompany the proposed minimum wage increase. The bill is currently the pending business in the Senate. On Monday, Majority Leader Harry Reid filed a petition to close off the debate and pass just the minimum wage increase, without any offsetting small business tax relief. This vote is scheduled to take place momentarily.

The consensus is that Senator Reid doesn’t have the 60 votes necessary to move the minimum wage package without the offsetting business tax relief, and the vote is being characterized as part …

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admin2019-02-06T18:46:06+00:00January 24, 2007|

109th Congress Concludes Business

Out with the Old Challenges

Last week the House and Senate wrapped up the 109th Congress by approving a “continuing resolution” to fund the federal government through February 15th. Doing so leaves major 2007 spending decisions to the new Democratic-controlled Congress when they convene in January.

The House and Senate also approved a $45 million tax bill that extends for two years popular to tax benefits, such as the Research and Development and Work Opportunity Tax Credits, many of which expired at the end of last year. This comprehensive package also included an energy tax title that extended, again for two years, …

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admin2019-02-06T18:46:06+00:00December 11, 2006|