Archive for January, 2012

Business Ethics, Moral Authority and the Schools – The Curious Case of Business School Blindness

If ain’t broken, don’t fix it – If it is broken, fix it!

Here is some old news: We have to do a better job detecting business scams. Here is a little more old news: We can’t trust anyone close to a potential scam to warn us — because they won’t. And it won’t matter that they are the alumni of our very best business and law schools.

Whether it was Enron, Bernard Madoff or the sub-prime mortgage fiasco, the personal and financial havoc they wrought was almost incalculable. Remarkably, nobody stepped in to intervene until after the major damage was already done. Our finest and brightest simply looked the other way…

» Read more: Business Ethics, Moral Authority and the Schools – The Curious Case of Business School Blindness

Breaking News For S Corporations – Potential 15% Tax Increase

There have been a number of rumors spread among the accounting community lately that the IRS has eliminated the ability for professionals who operate their business as an S Corporation to receive distributions from their companies in lieu of a wage or salary. On May 28th, 2010, The House passed The American Jobs and Closing Tax Loopholes Act of 2010 which contains a provision that proposes to raise over $11 billion by tacking on payroll taxes to certain service professionals who currently split income as wages and draws. And by certain service professionals, Congress specifically means those in “health, law, lobbying, engineering, architecture, accounting, actuarial science, performing arts, consulting, athletics, investment advice or management, or brokerage services. If this change becomes law, it can add a 15.3% surcharge to the distribution portion of the income that S Corporation owners pay themselves. The Senate has taken this issue up in its June session.

S Corporations are entities where the net income from the corporation passes to the shareholders and gets taxed at the shareholders marginal rate of taxation. S Corporation owners typically receive income from their businesses in two forms:

» Read more: Breaking News For S Corporations – Potential 15% Tax Increase