Abstract

http://ssrn.com/abstract=2365490
 


 



S Corp Taxation: Level the Playing Field


Cherie J. Hennig


University of North Carolina (UNC) at Wilmington - Department of Accountancy and Business Law

Blaise M. Sonnier


University of Colorado at Colorado Springs - College of Business

William A. Raabe


University of Wisconsin - Whitewater - College of Business and Economics

John O. Everett


Virginia Commonwealth University (VCU) - Department of Accounting

April 22, 2013

Tax Notes, April 22, 2013

Abstract:     
A MAXTax would equalize the tax treatment of business income from passthrough entities with that of corporations. The tax revenue loss from a MAXTax would be partially offset by closing the S corporation SE tax loophole. In the absence of a MAXTax, individuals may choose to incorporate their businesses to take advantage of the lower corporate tax rate. If the S corporation payroll tax loophole is not closed, more individuals will use S corporations to minimize their Medicare and net investment income tax liabilities, significantly reducing projected tax revenues from those taxes.

Number of Pages in PDF File: 8

Keywords: S corporation, self employment tax, medicare tax, net investment income tax, choice of entity, small business

JEL Classification: E62, H25, K34

Accepted Paper Series


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Date posted: December 11, 2013  

Suggested Citation

Hennig, Cherie J. and Sonnier, Blaise M. and Raabe, William A. and Everett, John O., S Corp Taxation: Level the Playing Field (April 22, 2013). Tax Notes, April 22, 2013. Available at SSRN: http://ssrn.com/abstract=2365490

Contact Information

Cherie J. Hennig
University of North Carolina (UNC) at Wilmington - Department of Accountancy and Business Law ( email )
601 S. College Road
Wilmington, NC 28403
United States
Blaise M. Sonnier
University of Colorado at Colorado Springs - College of Business ( email )
1420 Austin Bluffs Parkway
Colorado Springs, CO 80933-7150
United States
William A. Raabe (Contact Author)
University of Wisconsin - Whitewater - College of Business and Economics ( email )
Whitewater, WI 53190
United States
HOME PAGE: http://billraabetax.com
John O. Everett
Virginia Commonwealth University (VCU) - Department of Accounting ( email )
Richmond, VA 23284
United States
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