Can any of you tell me why it makes sense to tax a work of legal fiction instead of taxing actual individuals?
2007-11-15 10:49:05 · 6 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
I think some of you are missing the point.
Corporate taxes aren't paid by the corporation to begin with, the price is merely passed on to the consumer.
As this is the case, does it not make more sense just to tax individuals?
2007-11-15 17:50:42 · update #1
They are taxing individuals. And only end user individuals actually pay any tax at all.
Each time they charge a fee or tax to a Corp, the end user, or individuals are the ones that actually pay it. It is factored into the price of the product or service.
Then we pay tax again when we earn, spend or save our money.
C'mon flat tax !
2007-11-15 10:58:55 · answer #1 · answered by Perplexed 5 · 0⤊ 0⤋
What makes you think that a corporation is "legal fiction?" Sorry, but it's anything but ficticious.
The short and simple answer is that that's the law. That's why corporate income is taxed. From your logic, why should any business be taxed -- it's the customers who ultimately pay anyway, right? Same answer: It's the law.
In case you haven't noticed, individuals pay income taxes as well.
Are you proposing that corporations pay no tax at all and that individual income taxes be raised to compensate? If you are, you must be some sort of corporate shill. But even so, YOUR tax bill would rise as well. Is THAT what you want??
2007-11-18 18:24:03 · answer #2 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Only in case of C-corporation, the income of the corporation is taxed.
In case of S-corporation, the income is passed on to the share holders. The corporation only pays the State (FBT) tax, which is $800 in CA.
2007-11-15 23:14:21 · answer #3 · answered by MukatA 6 · 0⤊ 0⤋
It is part of the price you pay to operate as a corporation. The owners could opt to be a subchapter S corporation and have the income flow directly to the share holders if they wish.
2007-11-15 16:41:16 · answer #4 · answered by Anonymous · 0⤊ 0⤋
actually its a double tax, the corporation is taxed on its profits and the investors are taxed on the same money for capital gains or personal income.
its all about the government taxing everyone as many times as they can.
2007-11-15 11:05:40 · answer #5 · answered by Brad456 5 · 0⤊ 0⤋
Because that "work of legal fiction" partakes of many of the same governmental services as individuals do.
2007-11-15 10:57:32 · answer #6 · answered by HyperDog 7 · 0⤊ 0⤋