My question is a bit complicated. First, I have an "S" class corporation with myself and my wife as the sole shareholders.
Second, I just recently started receiving a bimonthly 1099 check made out to my name. Unrelated, I also receive a regular paycheck from a normal job.
My questions are:
1. Can my corporation claim the 1099 income for itself, rather than me claiming it for myself?
2. Can the corporation then disburse its profit as dividends
(at a 15% tax
rate) to its shareholders (ie, myself and my wife)?
3. If the business disburses dividends of the entire amount, does that mean that the corporation does not pay taxes (ie, no double taxation
-- the 15% dividend tax
would be the only tax that gets paid on that income)?
4. To accomplish the above, do I need to switch the class S to a class C?