Immi_Questions
New Member
Here I am posting some questions ,Got answer from CPA for few ...
Still there are some which is unanswered....I'll appreciate your comments/answers if you can....
Q1:A software company will provide manpower thru out USA also it will
sell software packages (applications) - do we have to have a company
register in every state ? how this consulting work?
A1:As per law you will have to have a company in other state(file foreign corp) but if it's
temp it can be avoided.
Q2:worker may be resident of of state where the project is or he will move there to work at client side
A1
ayroll must be run for the state where the worker is residing & not where the company is located
but when it's temp then this can be avoided & payroll taxes can be paid where the company is....
Q3:Flexiblity on % of profit sharing as distribution,Copmany should be able to drop
& add partners at anytime.Change % on profits to owner anytime.....
A3:This will trigger the capital gain on the owner who is gaining more power(more share)
capital gain will be filed on 1040 return of owner.
Q:Capital gain if share value is 1 cent at startup ? Q:capital gain will change after a year or two?
Q4artner is non US citizen/non resident - He resides in INDIA, Indian Citizen
Q4a:Tax implication Foreigner- He(Foreigner) pays taxes in US as NON RESIDENT 1040DNR
& Also this can be avoided if he bills the US company for his services for compensation & US company
pays him via wire,money order,bank draft etc....
Q5:What will be the tax implication if branch office is in INDIA & USA has Head office ?
Tax implication on indivicdual/company
A5:
Q6:What will be the tax implication if branch office is in USA & INDA has Head office ?
Tax implication on indivicdual/company
A6:
Q7
ouble taxation on C corporation...%rate of tax applied on dividends ?
for 10 & 15 % tax bracket holder it's 5%
then its 15% for higher brackets.....
A7: Check on qualified dividend ?(What is Qualifying deividends ?- In my case distribute
profits are qualifying or not?
In 2008 taxes on dividends are going to be 0% is that right?)
Q7A:Analysis on 120 thousand & 150 thousnad of combined income for married filing joint return?
A7A:
Q8A: Long-Term Capital Gains and Qualifying Dividends--2005
For taxpayers in the 10% or 15% bracket--5%
For taxpayers in higher brackets--15%
Tax on unrecaptured Sec. 1250 gain--25%
Capital gain rate on collectibles--28%
What is Qualifying deividends ?- In my case distribute profits are qualifying or not?
Q9:In 2008 taxes on dividends are going to be 0% is that right?
A9:Not sure - CPA doubted
Q10:Nominee officer ?
A10:?
Q11ersonal Service Company have flat rate of 35% , Is my company the same ?
A11:?
Q12:S Corp I have some 20 grand loss from stock market from year 2000 to 2004 -- If I open a S Corp then it will pass
profit to me on my indivudial tax rate - will profit be compensated for the losses that I had from scorp?
A12:It has to passthru 1040 every year.
Q13:Can S corp keep somemoney with it without passing thru to employee ?
A13:They pay taxes anyway -?
Q14:C Corp -Tax implication on salary / dividend on foreigner (Indian citizen in India)?
A14:He will pay non resident tax in USA & USA company will be able to deduct
Q15: C corp one owner in India - salary/dividen & taxes ?
A15:
Q16:An USA based company finds a software project in USA & subcontract part of it to India based company/individual
tax implication / deduction on USA based company?
A16:Indian company or individual will send a bill for his service,US company will pay & will deduct as expese.
Q17:Income in USA dollar to india is tax free,right? tax implication on Indian individual ?
A17:
Q18:Same as 16 except here USA based copmany have hired foreign individual/Company to do website maintenance?
A18:Same as A16
Q19:Initial setup cost, what are they ? How to deduct expenses on taxes ? Some ideas about expenses.....
A19:State Filing fee,
Workers comp (400),
payroll,
book keeping(CPA),
tax return,
Other Expense - Utilities,paper,printer,coputer
Q20:How employee on business visa work in USA, where do they get salary ? allownes ? do they file USA taxes ?
A20: They get allownces here in usa
Q21:Corporation is registered in XYZ state & owner resiedes in ABC state & project is anywhere in USA ? tax implication
on Owners dividend & salary ? where he file state taxes where the company is or where he lives?
A21:
Q22:Corporation average salary to Directior/officer ? how much maximum can be dividend ? limit on salary or dividend?
A22:At least 35000 salary,no limit on dividend.
Q23:FICA/SECA savings on which type of corp?
A23:C & S corp when paid as dividend
Q24:Basic/Monthly cost of maintaining C/S/LLC corp ?
A24:
Q25:what are the required insurnaces & estimate on how much it would cost ?
A25:
Q26:How about a USA based company hiring a permanet employee in INDIA for managing work given in INDIA?
tax implication on employee ? what kind of work will he should be doing ?
A26:
Q27iscuss some strategies of lowering corporate taxes?
Q28:Cash method/Accrual method ? Accounting methods discuss in detail...
Q29ifferent ways of taking money out of corporation?
Q30:Sale taxes on software package that they sell ?
A30:Sale taxes applies but can be avoided by saying it was a service
Q31:Unemployement - Owner is also an employee , but what if owner fires him because there is no project to be done , will he
be eligible for unemployement tax
A31:NO eligible if he is owner of corporation
Q32:Company is registered in in XYZ state with proper address & one office is in ABC state(Home where owner lives - part is office)?
Deduction on rent ?
A32:
Q33onation - Donation to India ? tax implication on individual /US based company ?
A33:No way to deduct in USA
Q34:Corporation Tax Rates On Taxable Income: Personal Service Corporations may
be subject to a flat 35% tax. Personal Holding Companies may be subject to a 39.6% tax on undistributed PHC income.
Members of a controlled group of corporations must use the graduated tax rates as if they were combined into one corporation (see IRC §1551).
A C corporation may also be subject to a 39.6% accumulated earnings tax on retained earnings. A C corporation may also be subject to a 20% alternative minimum tax. Discuss !
Q35:Go thru following websites -http://www.1120accountant.com
Q36ividends Received Deduction
The dividends received deduction is meant to reduce the negative effects of the double tax on C corporation profits distributed to corporation shareholders as dividends.
Q37:Now S corp then C corp in 2006 ?
A37:Yes you can do it then c will have to be c for 5 years
Q38:Business License ? Do I need it ?
A38:When you register you get one.....
Q39:Strategies for getting IN/OUT as owner & claiming unemployement benefits?
A39:Have sadaf work as Boss-single owner & then get in & out.
Q40:Resident Agent?
A40:Almost every state requires a corporation or an LLC to have a Registered Agent (sometimes called a resident agent, statutory agent, or agent for service of process). The Registered Agent address is the address that will be used by the state for any official legal and tax correspondence. The Registered Agent address must be a physical, in-state street address; P.O. Boxes are not acceptable. If needed, IncFile can provide you with a Registered Agent for only $99.00 per year, and any official legal and tax correspondence from the state will be forwarded to your billing/shipping address.
NOTE: If you require us to provide a registered agent, the address cannot be used as a general business/mail forwarding address. Only official legal and tax correspondence from the state will be forwarded, and any other mailings to the registered agent may result in additional charges.
Q41:Corporate Kit?
A41:The Corporate Kit is a professional binder enclosed in a matching slip case, customized with the name of your company on the spine insert. It comes with a metal die-cast corporate embossing seal with its own carrying pouch, customized with the name of your company and the date and state of formation. It has a set of 6 Mylar Reinforced Index Tabs, 25 custom printed stock or membership certificates with 25 full page stubs. It also comes with a variety of corporate forms on CD-Rom. The kit can be added to your order of our standard formation service, and it is included with the Premium Package.
Q42:SS4 Form?
A42:The SS4 is the IRS form required to obtain an EIN (Employer Identification Number, frequently called a Tax ID number). The EIN/Tax ID number can be thought of as a Social Security Number for your business. It is usually required to open a bank account in the name of the business and to properly pay and account for any wage/payroll employees of your company. If you require this service we will prepare the SS4 form, and return with your filed formation documents for your signature to file with the IRS. Optionally, you can elect to have IncFile obtain your EIN electronically for you so you will have it ready to go as soon as your company is formed. Just check the appropriate options on the order form and we will send you the prepared SS4 or obtain your EIN electronically, as required
Still there are some which is unanswered....I'll appreciate your comments/answers if you can....
Q1:A software company will provide manpower thru out USA also it will
sell software packages (applications) - do we have to have a company
register in every state ? how this consulting work?
A1:As per law you will have to have a company in other state(file foreign corp) but if it's
temp it can be avoided.
Q2:worker may be resident of of state where the project is or he will move there to work at client side
A1
ayroll must be run for the state where the worker is residing & not where the company is locatedbut when it's temp then this can be avoided & payroll taxes can be paid where the company is....
Q3:Flexiblity on % of profit sharing as distribution,Copmany should be able to drop
& add partners at anytime.Change % on profits to owner anytime.....
A3:This will trigger the capital gain on the owner who is gaining more power(more share)
capital gain will be filed on 1040 return of owner.
Q:Capital gain if share value is 1 cent at startup ? Q:capital gain will change after a year or two?
Q4
artner is non US citizen/non resident - He resides in INDIA, Indian Citizen Q4a:Tax implication Foreigner- He(Foreigner) pays taxes in US as NON RESIDENT 1040DNR
& Also this can be avoided if he bills the US company for his services for compensation & US company
pays him via wire,money order,bank draft etc....
Q5:What will be the tax implication if branch office is in INDIA & USA has Head office ?
Tax implication on indivicdual/company
A5:
Q6:What will be the tax implication if branch office is in USA & INDA has Head office ?
Tax implication on indivicdual/company
A6:
Q7
ouble taxation on C corporation...%rate of tax applied on dividends ? for 10 & 15 % tax bracket holder it's 5%
then its 15% for higher brackets.....
A7: Check on qualified dividend ?(What is Qualifying deividends ?- In my case distribute
profits are qualifying or not?
In 2008 taxes on dividends are going to be 0% is that right?)
Q7A:Analysis on 120 thousand & 150 thousnad of combined income for married filing joint return?
A7A:
Q8A: Long-Term Capital Gains and Qualifying Dividends--2005
For taxpayers in the 10% or 15% bracket--5%
For taxpayers in higher brackets--15%
Tax on unrecaptured Sec. 1250 gain--25%
Capital gain rate on collectibles--28%
What is Qualifying deividends ?- In my case distribute profits are qualifying or not?
Q9:In 2008 taxes on dividends are going to be 0% is that right?
A9:Not sure - CPA doubted
Q10:Nominee officer ?
A10:?
Q11
ersonal Service Company have flat rate of 35% , Is my company the same ? A11:?
Q12:S Corp I have some 20 grand loss from stock market from year 2000 to 2004 -- If I open a S Corp then it will pass
profit to me on my indivudial tax rate - will profit be compensated for the losses that I had from scorp?
A12:It has to passthru 1040 every year.
Q13:Can S corp keep somemoney with it without passing thru to employee ?
A13:They pay taxes anyway -?
Q14:C Corp -Tax implication on salary / dividend on foreigner (Indian citizen in India)?
A14:He will pay non resident tax in USA & USA company will be able to deduct
Q15: C corp one owner in India - salary/dividen & taxes ?
A15:
Q16:An USA based company finds a software project in USA & subcontract part of it to India based company/individual
tax implication / deduction on USA based company?
A16:Indian company or individual will send a bill for his service,US company will pay & will deduct as expese.
Q17:Income in USA dollar to india is tax free,right? tax implication on Indian individual ?
A17:
Q18:Same as 16 except here USA based copmany have hired foreign individual/Company to do website maintenance?
A18:Same as A16
Q19:Initial setup cost, what are they ? How to deduct expenses on taxes ? Some ideas about expenses.....
A19:State Filing fee,
Workers comp (400),
payroll,
book keeping(CPA),
tax return,
Other Expense - Utilities,paper,printer,coputer
Q20:How employee on business visa work in USA, where do they get salary ? allownes ? do they file USA taxes ?
A20: They get allownces here in usa
Q21:Corporation is registered in XYZ state & owner resiedes in ABC state & project is anywhere in USA ? tax implication
on Owners dividend & salary ? where he file state taxes where the company is or where he lives?
A21:
Q22:Corporation average salary to Directior/officer ? how much maximum can be dividend ? limit on salary or dividend?
A22:At least 35000 salary,no limit on dividend.
Q23:FICA/SECA savings on which type of corp?
A23:C & S corp when paid as dividend
Q24:Basic/Monthly cost of maintaining C/S/LLC corp ?
A24:
Q25:what are the required insurnaces & estimate on how much it would cost ?
A25:
Q26:How about a USA based company hiring a permanet employee in INDIA for managing work given in INDIA?
tax implication on employee ? what kind of work will he should be doing ?
A26:
Q27
iscuss some strategies of lowering corporate taxes?Q28:Cash method/Accrual method ? Accounting methods discuss in detail...
Q29
ifferent ways of taking money out of corporation?Q30:Sale taxes on software package that they sell ?
A30:Sale taxes applies but can be avoided by saying it was a service
Q31:Unemployement - Owner is also an employee , but what if owner fires him because there is no project to be done , will he
be eligible for unemployement tax
A31:NO eligible if he is owner of corporation
Q32:Company is registered in in XYZ state with proper address & one office is in ABC state(Home where owner lives - part is office)?
Deduction on rent ?
A32:
Q33
onation - Donation to India ? tax implication on individual /US based company ?A33:No way to deduct in USA
Q34:Corporation Tax Rates On Taxable Income: Personal Service Corporations may
be subject to a flat 35% tax. Personal Holding Companies may be subject to a 39.6% tax on undistributed PHC income.
Members of a controlled group of corporations must use the graduated tax rates as if they were combined into one corporation (see IRC §1551).
A C corporation may also be subject to a 39.6% accumulated earnings tax on retained earnings. A C corporation may also be subject to a 20% alternative minimum tax. Discuss !
Q35:Go thru following websites -http://www.1120accountant.com
Q36
ividends Received DeductionThe dividends received deduction is meant to reduce the negative effects of the double tax on C corporation profits distributed to corporation shareholders as dividends.
Q37:Now S corp then C corp in 2006 ?
A37:Yes you can do it then c will have to be c for 5 years
Q38:Business License ? Do I need it ?
A38:When you register you get one.....
Q39:Strategies for getting IN/OUT as owner & claiming unemployement benefits?
A39:Have sadaf work as Boss-single owner & then get in & out.
Q40:Resident Agent?
A40:Almost every state requires a corporation or an LLC to have a Registered Agent (sometimes called a resident agent, statutory agent, or agent for service of process). The Registered Agent address is the address that will be used by the state for any official legal and tax correspondence. The Registered Agent address must be a physical, in-state street address; P.O. Boxes are not acceptable. If needed, IncFile can provide you with a Registered Agent for only $99.00 per year, and any official legal and tax correspondence from the state will be forwarded to your billing/shipping address.
NOTE: If you require us to provide a registered agent, the address cannot be used as a general business/mail forwarding address. Only official legal and tax correspondence from the state will be forwarded, and any other mailings to the registered agent may result in additional charges.
Q41:Corporate Kit?
A41:The Corporate Kit is a professional binder enclosed in a matching slip case, customized with the name of your company on the spine insert. It comes with a metal die-cast corporate embossing seal with its own carrying pouch, customized with the name of your company and the date and state of formation. It has a set of 6 Mylar Reinforced Index Tabs, 25 custom printed stock or membership certificates with 25 full page stubs. It also comes with a variety of corporate forms on CD-Rom. The kit can be added to your order of our standard formation service, and it is included with the Premium Package.
Q42:SS4 Form?
A42:The SS4 is the IRS form required to obtain an EIN (Employer Identification Number, frequently called a Tax ID number). The EIN/Tax ID number can be thought of as a Social Security Number for your business. It is usually required to open a bank account in the name of the business and to properly pay and account for any wage/payroll employees of your company. If you require this service we will prepare the SS4 form, and return with your filed formation documents for your signature to file with the IRS. Optionally, you can elect to have IncFile obtain your EIN electronically for you so you will have it ready to go as soon as your company is formed. Just check the appropriate options on the order form and we will send you the prepared SS4 or obtain your EIN electronically, as required