[QUOTE=Damuri Ajashi;19483341
pro-abortion and death tax are political terms. Double taxation is a tax concept that exists in apolitical contexts.[/QUOTE]
No, it’s political, all income is taxed many times.
If your LLC is sued, damnbetcha you will claim exactly that. If your LLC goes bankrupt, damnbetcha you will claim exactly that.
No, its not. A particular dollar may get taxed many times as it is earned by different people but plenty of income is taxed just the one time.
You are importing an argument used by Republicans who protested how government employees spend their money was the expenditure of government money after it had been earned by the employee into a totally different situation.
When you earn your wages, it is taxed once. When you pay the plumber, the plumber is taxed once. When the plumber buys a car, the car dealer is taxed once. When the owner of the car dealership withdraws the profit from the dealership, they are taxed again on that same income. Hence double taxation. You are free to try and redefine the meaning of those words, but the term has a particular meaning among tax and financial professionals. It is also used among policy makers to describe the policy issues surrounding double taxation. The fact is that corporate profits are subject to double taxation. I understand that you don’t like facts that are not consistent with your politics but Republicans have had to deal with that problem for a long time. This time its your turn.
When I earn my wages it is taxed then when I spend it I pay sales tax. That’s TWICE.
When the plumber buys a car, the car dealer Entity is taxed once. When the owner (different entity) of the car dealership withdraws the profit from the dealership, they are taxed on different income. Since they are different *entities. *
I am a “tax and financial professional” and it’s purely a political term in line with “death taxes”.
Why would I claim exactly that, damnbetcha? I have no need to.
So they dont go after your personal assets, you will claim that the LLC and you are different Entities.
The claim in question is that I don’t own my LLC’s assets. Please cite that this claim is required to protect my other assets.
Well, if you- Ruken owns them, not Rukenco LLC, then yes, they can & will be attached. So who owns them?
You and your LLC are separate Entities.
I know. I don’t see this as any kind of problem. If he wants to avoid this, there are various ways he can arrange to spread his income out.
I’ll ask again. Please cite that I need to claim that “* don’t own the assets of a company that * own and control in its entirety” “so they dont go after [my] personal assets”?
Should be an easy cite to find if ownership, by definition, implies a responsibility to others for actions regarding the property.
OK, let us say they sue Rukenco or Rukenco goes bankrupt.
Being inc means they can only take Rukencos assets, not Ruken’s personal assets.
Ruken does not own Rukencos assets. Ruken*co *owns Ruekncos assets. You are not Rukenco. It is a separate legal Entity.
I think you understand that and are trying to make some sort of odd point. What is your point?
My physician friend would like to know how she can arrange to spread her income out now that she’s finally earning a full salary after a decade of deferred income and $200k+ in debt. Let me know if you have any tips. 
That is, a graduated income tax decreases the net present value of activities many of us find beneficial to society, e.g. education. I don’t necessarily see it (or many of the other topics discussed in this thread, e.g. double vs pass-through taxation) as a problem per se, just something to include in the cost benefit analysis.
You’re not getting it. It’s not even cite-able the way you’re phrasing the question because of how much you’re not getting it.
Here’s an example: XYZ Corporation owns 100 cows. You own 100% of the stock of XYZ corporation.
To the question “Do you own XYZ corporation?” the answer is yes. 100% of it.
To the question “Do you own 100 cows?” the answer is no.
In a lawsuit or a bankruptcy, your asset - the shares of XYZ - could be taken in payment for the debt. However, no one will have grounds to take even a single cow, because you do not own any cows.
So you ask “But can’t I choose to give them cows instead of giving them stock?” Certainly. As shareholder of the company, you can hold a meeting of the shareholders and resolve that the board of directors is authorized to pay a dividend in the form of cows. You receive cows, which are now yours and not the company’s, and you pay your legal debts with those cows. However, until you formally declare distributions in the form of cows, you only own shares and not cows.
(And just to tie all this back to the overall taxation of gains or dividends: having received cows as a dividend, you now owe income tax on the fair market value of those cows.)
If you’re thinking about it in reverse, let’s say that XYZ is involved in a lawsuit. The lawsuit is so bad that 100 cows are not sufficient to pay the debt. XYZ will declare bankruptcy, surrender the 100 cows, and courts will nullify the remaining debt. You as the shareholder will not lose any assets - not even your shares of XYZ! Admittedly, those shares are probably considered worthless, but the fact remains that you still own 100% of XYZ.
When was the owner previously taxed on that income?
And my objection to the term “double taxation” is because it is wildly inaccurate. Because it is so inaccurate, it is only ever used by people trying to make a political point. The political position they are arguing for, being based on a falsehood, is unsurprisingly unjust, and so I object to it, too.
The point is that I own the LLC’s assets by virtue of owning the LLC, and I am not required to claim otherwise to limit my liability. You said I *will *claim otherwise, damnbetcha. But I am not required to claim that., because it’s not the lack of ownership that limits my liability. Whether you want to call the business a separate legal Entity with a Capital E is irrelevant, because that’s not what confers the limit; see states that use RUPA.
If you don’t like DrDeth’s claim, take it up with DrDeth.
Ok we were talking about LLCs, but we can talk about C-corps. I’ll play.
Of course I own the cows. And if my creditors take my shares, they own the cows. And if XYZ is liquidated to creditors, I have lost the assets of XYZ, because I own XYZ, and no longer own the cows.
You are correct that I would be taxed on the cow dividend if XYZ is organized as a C-corp. If an S-corp (the more likely scenario, although both are unusual for a single owner), I would not be taxed on the cow distribution.
Imagine that you were forced to make a complete listing of all your assets (maybe you’re getting divorced and the court wants to know what you have so it can be split with your soon-to-be-ex).
Do you list [ol]
[li]Stock in XYZ (at a value of $A)[/li][li]100 cows (at a value of $A)[/li][li]Stock in XYZ and 100 cows (at a value of $2A?)[/li][/ol]
From a legal standpoint you really do only own XYZ. The fact that XYZ is a ‘person’ who can own things separately from the owners of XYZ is kinda the whole point. And the fact that as the sole owner of XYZ you can trivially transfer any asset from XYZ to yourself doesn’t change that.
Then show me the damn law already.
If you dont know what corporations are and how they limit legal liability, then there’s no use giving you a cite.
Here’s wiki anyway.
are you just pretending you dont know or are you trying to make a point?
Do you understand what the word ‘profit’ means?
I chose to use that word because it was more concise, but as you appear not to have grasped the meaning I will explain further. When I said that tax would be paid on the ‘profit’ I was referring to the difference between the amount spent (1m in my example) and the amount received(2m). Thus, I was referring to a tax on the 1m that was in excess of the amount spent initially.
Do you think that paying taxes on the $1m profit is ‘double taxation’? Or does taxing money that a corporation pays out as required by a contract only count as ‘double taxation’ when we call that contract a ‘stock’?