Self-employed techs

[Brian Doepke]

Hi Dean,
 
I have been an S corp., but here in Fort Wayne, and all Indiana, it is very
acceptable to become an LLC (this according to my new tax advisor who has
been doing this for over 20 years).  I plan on switching to an LLC.
 
Check it out.  It might be worthwhile.
 
Brian P. Doepke, (dep-kee)
R.P.T. (Registered Piano Technician)
AAA Piano Works, Inc.
Piano Tuning-Repair-Purchase Consults
260.417.1298
260.432.2043
    www.aaapianoworks.com
 
  _____  

From: David and Jean Weiss [mailto:djweiss at ntelos.net] 
Sent: Sunday, October 07, 2007 10:45 AM
To: Pianotech List
Subject: Re: Self-employed techs
 
Dean,
 
Very interesting.  
 
But would that have an impact your social security payout at retirement?
 
David Weiss
 
From: Dean <mailto:deanmay at pianorebuilders.com>  May 
To: 'Pianotech List' <mailto:pianotech at ptg.org>  
Sent: Sunday, October 07, 2007 8:50 AM
Subject: RE: Self-employed techs
 
One of the biggest benefits of S corp is reduction of self employment tax.
Under S corp you hire yourself to do the work. You pay yourself a nominal
salary that is subject to normal withholdings- including FICA and the
employers share, which amounts to the same as the 15% self employment. The
bonus is that you as the owner/majority share holder get to pay yourself
dividends off the company’s profits. These dividends are treated like
interest income and are only subject to ordinary income tax; they not
subject to FICA taxes. 
 
For example, if your business nets $75k per year and you are sole
proprietor, you pay 15% off the top for self-employment which is over $11k.
Under S corp you could hire yourself for a technician salary of say $25k per
year (you make up a “reasonable” number here) and pay the remaining $50k out
as dividends. You only pay the FICA taxes on the $25k. This would save you
$7500 per year in self employment taxes.
 
There may be other benefits and/or liabilities. Check with your tax
consultant. 
 
Dean
Dean May             cell 812.239.3359 
PianoRebuilders.com   812.235.5272 
Terre Haute IN  47802

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From: pianotech-bounces at ptg.org [mailto:pianotech-bounces at ptg.org] On Behalf
Of Greg Newell
Sent: Saturday, October 06, 2007 10:20 PM
To: Pianotech List
Subject: RE: Self-employed techs
 

David,  
        A year or two ago I switched from Sole Proprietor , which I was for
almost 20 years, to a LLC. It was explained to me that I needed some
protection against law suits etc. Recently I reunited with my cousin who
just happens to be an excellent book keeper. She insists that she will be
able to put a great deal of money back in my pocket by switching me to a sub
S Corp. I don't pretend to know anything about it and strangely enough, I'm
quite ok with that. I'll let her figure out all that stuff and I'll try to
keep doing what I do and just maybe it'll work out in the end. Or maybe I'll
be busy enough not to notice anyway.

all the best,
Greg Newell 



At 10:25 AM 10/6/2007, you wrote:
Has anyone explored the differences between forming an LLC and an S
Corporation and the benefits of going that route as opposed to a simple sole
proprietorship?  
 
If anyone can direct me to good literature or share their own experiences on
the subject, I’d appreciate it.
 

David Love
davidlovepianos at comcast.net
www.davidlovepianos.com <http://www.davidlovepianos.com/>  
 
Greg Newell
Greg's Piano Forté
www.gregspianoforte.com <http://www.gregspianoforte.com/> 
216-226-3791 (office)
216-470-8634 (mobile)

2003,04,05 & 06 winners of 
Angie's List Super Service Award
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