We, the Chicago Accountants, have come to the conclusion that S Corporations are the #1 small business entities for entrepreneurs with ordinary income.

Major reasons why you may form an S-Corporation:

1.  Officers and shareholders of an S-Corporation are not personally liable for corporate debts and liabilities

2. The S-Corporation's income distributed to you as a shareholder will not be subject to self-employment tax, however, your wages as an employee will be subject to social security taxes.

It is very important that business owners realize that if they have passive income (such as a rental property), an S-Corporation should generally not be used, but a Limited Liability Company (LLC) or Limited Partnership (LP). The S-Corporation is best suited to manage ordinary income, even if it is a partner in an LLC with other S-Corp partners because the LLC is an operational business.

In order to receive the asset protection of an S-Corporation it is important that the corporation be adequately financed, that various formalities required by your state be observed ( filing articles of incorporation, adopting by-laws, electing a board of directors, and holding organizational meetings), and that the existence of the corporation as a separate entity be maintained.

In regards to the wage and net-income planning, we encourage you to allocate at least 40% of their net-income to wage earnings and the remaining amount can flow out as a dividend or net-income, which are not subject to self employment tax. However, you should obtain a competent professional advice in this regard first.  It is important to maintain this procedure through proper payroll planning. Quarterly reports are required.

When it comes to first years losses in any type of business, an S-Corporation is preferable to a C-corporation from a tax standpoint. Shareholders in a C-corporation generally get no tax benefit from such losses.

On the other hand, as S-Corporation shareholders, each of you can deduct your percentage share of these losses on your personal tax return to the extent of your basis in the stock and in any loans you make to the entity. Losses that cannot be deducted because they exceed your basis are carried forward and can be deducted by you when there is sufficient basis.

Once the corporation begins to earn profits, the income will be taxed directly to you whether or not it is distributed. It will be reported on your individual tax return and be aggregated with income from other sources.

Please remember that the S-Corporation could inadvertently lose its S status if either of you transfers stock to an ineligible shareholder such as another corporation, a partnership, or a nonresident alien.

If the S election were terminated, the corporation would become a taxable entity. You would not be able to deduct any losses and earnings could be subject to double taxation-once at the corporate level and again when distributed to you.

This is, of course a short summary of the benefits of an S-Corporation and how to maintain such a company in good standing with the State and IRS.  We have incorporated thousands of businesses and have advised many of them to convert into an 'S' corp based on tax planning criteria.  To find out if an 'S' corporation is right for you, please call us at 773-728-1500.

Peripheral Artery Disease & Treatments

Thursday, November 1, 2012

Many who have peripheral artery disease do not show any symptoms. Join Dr. Steve Attanasio, an interventional cardiologist at Swedish Covenant Hospital, as he discusses this elusive disease. Topics include prevention, detection and treatment options.  Free

Time: 10 - 11 AM

Location: Anderson Pavilion, Auditorium, 2751 W. Winona Ave.

Reservation: (773) 878-6888

Make Your Own Baby Food

Saturday, November 3, 2012

Making your own baby food is a guarantee that your little one is getting food packed with fresh fruits and vegetables. In this interactive program with Whole Foods Market Sauganash, you will learn how to make, store and serve baby food. A registered dietitian from Galter LifeCenter will also be on hand to explain the nutritional benefits for baby and tips on feeding schedules. Learn now while the bun is still in the oven! 

Samples of the latest baby products will be provided by kickSprout, our community partner helping expectant and new parents connect through fun events.

Single ticket: $10.00

Couple ticket: $15.00

Time: 10:30 AM - 12:00 PM

Location: Whole Body Fitness 6125 N. Cicero Ave.

Reservation: (773) 878-6888

Vitamins: Find Your Balance

Monday, November 5, 2012

Most Chicago women are vitamin D deficient which can affect bone strength, mood and energy level. Join Dr. Silvia Panitch, an internal medicine physician at Swedish Covenant Hospital, as she discusses the top vitamin deficiencies, supplement recommendations, choosing food to balance your diet and new developments in nutrient level testing. Free

Time: 7 - 8 PM

Location: Galter LifeCenter, 5157 N. Francisco Ave.

Reservation: (773) 878-6888

Practical Parenting Series: Sleeping Babies, Happy Parents

Tuesday, November 6, 2012

Join Dr. Andy Sagan, pediatrician and medical director of Swedish Covenant Medical Group Pediatrics, as he discusses proactive strategies for infant sleep. Giveaways and gift bags will be distributed courtesy of kickSprout, a local organization creating fun events for expectant parents and families.  

Note: This class is for expectant parents and parents of infants.

Register online here.

Other class(es) in this series: Practical Parenting: Infant & Toddler Eating Habits on December 4

Single ticket: $10

Couple ticket: $15

Time: 7 - 8:30 PM

Location: Family Grounds Cafe, 3652 N. Lincoln Ave.

Reservation: (773) 878-6888

Dinner Series: Great Skin, Hair and Nails

Tuesday, November 6, 2012

Enjoy a four-course gourmet meal while a registered dietitian from Swedish Covenant Hospital and Galter LifeCenter shares dietary tips and home beauty treatments to keeping your nails strong, skin glowing and hair shining.

Course 1: Sweet Potato Fries with goat cheese fondue

Course 2: Sunshine Salad

Course 3 (choose one): Seasonal Fish -OR- Pumpkin Ravioli

Course 4: (choose one): Smores Tart -OR- Fruit Platter

Cost: $36 (includes tax & gratuity)

Click here to buy your ticket or call Brown Paper Tickets at (800) 838-3006.

Cost: $36.00

Time: 6:30 - 8:30 PM

Location: Uncommon Ground Clark, 3800 N. Clark St.

Reservation: (800) 838-3006 Brown Paper Tickets

Mammograms for Life

Thursday, November 8, 2012

Michelle Peters, breast health navigator at Swedish Covenant Hospital, will discuss proper self-examination, the latest in breast health and new developments in 3-D mammography. Free

Time: 10 - 11 AM

Location: Anderson Pavilion, Auditorium, 2751 W. Winona Ave.

Reservation: (773) 878-6888

Learn About Natural Childbirth

Wednesday, November 14, 2012

Learn about natural childbirth and nurse-midwifery philosophies from Sherri Ruerup, certified nurse-midwife and Director of Nurse-Midwifery at Swedish Covenant Hospital. Also hear from a panel of women who will discuss their experiences with childbirth.  Free

Time: 6 - 7 PM

Location: Bloom Yoga Studio 4663 N. Rockwell

Reservation: (773) 878-6888

Menopause, Hot Flashes and Insomnia

Thursday, November 15, 2012

Join Dr. Marina Claudio, a family practice physician from Swedish Covenant Hospital, as she discusses symptoms of "the change" and how to embrace the journey and alleviate inconvenient side effects. Free

Time: 7 - 8 PM

Location: Galter LifeCenter, 5157 N. Francisco Ave.

Reservation: (773) 878-6888

Family & Friends CPR Training

Tuesday, November 20, 2012

Family & Friends is a CPR Course for those who want to know CPR because of personal interest, for a family member, a new baby on the way, or because you always wanted to take a course!  Registration is required and class size is limited.  **Please note that this class is not for healthcare/child care workers that require a certificate**

Cost: Community Members $30

Time: 6 - 8:30 PM

Location: Anderson Pavilion, Titus Johnson

Reservation: 773-878-6888