12. S Corporation – favored, restrictions include one class of stock, only 100 shareholders, corporations, partnerships and nonresident aliens cannot be shareholders – tax free distributions when there is basis (no double taxation), (Form 1120S) individual shareholders pay the tax via passthrough
13. LLC – very common, needs to elect classification on Form 8332 (sole proprietor, S or C corp, or partnership)
48. 28 -30% of businesses declaring bankruptcy cite problems with their financials as their main reason/cause for filing – don’t let that happen to you
49. Keep copies of your expenses – the burden of proof falls on the taxpayer to substantiate their claims on their tax returns. KEEP YOUR RECORDS
54. If you have a bookkeeper, look over their shoulder or have someone else do it
55. The best thing you can do is have someone else reconcile the books/bank statements if you don’t do it yourself. This one simple action let’s that person know you will see everything. Look deeper into things that look out of place.
56. Fraudulent vendors – almost the same name, common address as person committing the fraud