Hacker News Reader

C Corp dividends are double taxed (once for the Company and once for the individual). This is a good strategy for Sub Chapter S Corps, but not C Corps.

Google Double taxation for more info.

Disclaimer - I am not a CPA or even play one on TV.

View on HN

Depending on how little of a "subsistence salary" we are talking about (and how little other taxable income the owner has) the increase in income tax may be less than the savings in payroll tax involved in moving from salary to dividends.

Reply on news.ycombinator.com