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| | CCH Business Owner's Toolkit | C Corporation Taxes |
 | | Note: personal service corporations (those whose employees spend at least 95 percent of their time in the field of health, law, engineering, architecture, accounting, actuarial science, performing arts, or consulting) are taxed at a flat rate of 35 percent of net profits. |
 | | Because a corporation is a taxable entity that is separate from its stockholders, its excess profits (profits remaining after being taxed at the corporate level) are not, as in the case of unincorporated businesses and S corporations, taxed to the owners when they are earned. |
 | | Typically, the corporation claims deductions for these expenses as business expenses on its income tax return, but where the expenses are clearly personal expenses, the corporation will be denied a deduction and the officer-stockholder will be deemed to have received a taxable dividend. |
| www.toolkit.cch.com /text/P07_2026.asp (871 words) |
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