Idaho Small Business Tax Specialists
Herndon CPA PA focuses on Idaho small business tax. We also serve clients in Washington, Oregon, and California – especially in professional services, health care, consulting, construction, hospitality, and farming and ranching.
We are happy to speak with you by phone, and will meet you as needed at your office to save you time. Also, we make use of modern encrypted file sharing for receiving files from you and for delivering copies of your returns and other documents to you.
Your geographic location is not important, as we use the latest in technologies to stay connected with you. We are able to file tax returns for you in all states that require them, and we use a secure portal to obtain documents from you and provide your completed returns, reports, and other items. We are a phone call away, and when a face-to-face meeting is warranted, we’ll arrange to meet you.
Pass Through Entities
HERNDON CPA specializes in pass through entities with presence in multiple states. Pass through entities are partnerships or S corps. Partnerships have more than one partner. S corps have at least one shareholder and up to 100 (not counting members of a same family).
The key aspect to pass through entities is the tax return prepared for the entity is an information return. These entities pay no tax, but rather the owners have the income allocated to them pass through to their individual tax returns and pay tax at the individual level.
With the recent tax code changes, and a lower corporate flat tax rate, it may make sense for some to now convert pass-through entities to traditional C corp status. Of course, there should be other drivers for doing so and not just achieving the lowest tax rate.
C corporations are the traditional corporation most people think of when thinking of corporate entities. C corps pay their own tax, and shareholders may receive dividends. C corps have what is called accumulated earnings and profit, which can be very useful for re-investing in the business. Pass through entities do not have this and all profits get allocated to the shareholders/partners.
The simplest business structure is someone in business who simply has a schedule C prepared on their personal tax return for their business interest. While it is relatively simple, it is definitely not the most advantageous entity type for liability protection or typically for tax purposes.
Free initial consultation
Contact us for a free initial consultation.