An LLC Question...

[JON]

That is the best POINT

RE: Reasonable Comp argument. Which is cheaper? PR taxes or lawyers?

I think the IRS realizes that. If all you are talking about is MEDI why fight. Hopefully the dollars are not huge and fighting over the amount better offer considerable savings in dollars for the client or you better being doing it free. Clients have to know and be aware when they are making decisions. That is our job to inform them and the p[otenial consequences.

[veritas]

The following excerpt is from a Robert Novak article written March of 2004


At 9 a.m. on June 28, 1995, articles of incorporation were filed with the North Carolina Secretary of State for John R. Edwards, P.A. (professional association), of Raleigh, N.C. The new corporation was authorized to issue 100,000 shares of common stock -- all owned by Edwards, who is its only employee. This is a classic Subchapter "S" corporation devised to shelter income, mainly for professionals such as lawyers (and also syndicated columnists, but not me). It is one of the last loopholes left in the Internal Revenue Code, and it is a big one.

Edwards put his own little corporation to good use in his last two years as a multi-millionaire personal accident lawyer before becoming a full-time politician. He paid himself salaries of $600,000 in 1996 and $540,000 in 1997, on which he paid Medicare taxes. As the sole stockholder, Edwards received dividends of $5 million for each of those years -- all of it free from Medicare taxes. That saved the future senator around $290,000.