Trump Tax Plan and Pass-Through Tax Cut

[stickyshift]

So, if Trump's proposed tax cut for pass-through businesses (like a medical practice structured as an S-corporation) goes through, should private practice partners expect a big windfall? He wants to knock the tax rate of such partners to 15%!

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[pathstudent]

So, if Trump's proposed tax cut for pass-through businesses (like a medical practice structured as an S-corporation) goes through, should private practice partners expect a big windfall? He wants to knock the tax rate of such partners to 15%!

No any well-run practice distributes all money to the partners at the end of year so there is no money left to tax.

 

[icpshootyz]

No any well-run practice distributes all money to the partners at the end of year so there is no money left to tax.

Correct. We pay no business taxes because all of the money not spent on practice expenses, employees, etc is distributed to the partners. We have to "clear the books" by Dec 31st, so December's a really nice month, although then Jan-Mar is pretty light to compensate.

 

[pathstudent]

Correct. We pay no business taxes because all of the money not spent on practice expenses, employees, etc is distributed to the partners. We have to "clear the books" by Dec 31st, so December's a really nice month, although then Jan-Mar is pretty light to compensate.

RIght because you are double paying SS tax until you earn 127,000 (1 part via the corp and 1 part via the partner), plus it is deductible season collections are slower.