Sure, you just described a fairly typical situation... at least not Atypical Now, how you handle the taxes is a different story ... are both of the companies Pass-through entities whose income and/or losses flow through to the owners tax return? (sole proprietorship, s_corp, LLC or partnership)
I still don't see you coming into the chat so I'll try to answer generally:
sorry, phone call
If both entities are owned by you, and they are passthroughs (mentioned above) then when you do the informational 1120-s for the S-Corp or the informational 1065 for the partnership OR the schedule C for a single member LLC or Sole Pr, then everything flows to your personal tax return anyway
sOK I'm here
Well State A charges corp taxes, State B doesnt,
So there still is a saving of 9%. but is there a better way..
then that will paid on the state corp return of state A
Please don't shoot the messenger here, state corp taxes are paid on a state corp return forr that business
If Business A ends up making a profit of 5k. than the 5k pays 8.8% taxes for Corp and than the remainder goes to the personal side....
yes, but in NY, theres a state and city corp tax
sorry for the mix up. so business A would be saving on the city
So since Business B would be the byusiness with the income, is it better for it to be a pass through
ok, right, but again when you are talking about state and/or city taxes they are taxed to the entity, specifically
Yes, so lowering the profit of Business A that pays a 9% city tax by paying Business B in a diff state. would be a savings.
CA keeps people from doing that by requiring a minimum tax
completely, profit is profit
perfect. now its about finding which state has the lowest state tax on the personal side.
thanks for your help
sounds like you have your arms around it