Tax Differences EXPLAINED: LLC, S Corp, Partnership, Sole Prop

[@rogersmj]

This is by far the clearest explanation of this topic I have yet run across. Very well presented, having apples to apples examples in a clean spreadsheet format, as opposed to the random whiteboard scribblings that some others do that are really hard to follow.

[@alansanchez3560]

Great video! It helps understand the basics I’m going to keep watching at the more complex topics!

[@lorapalacios8088]

If i want to open my own behavioral health/ mental healthy therapy practice and I am a Licensed Clinical Social worker in California can I do a partnership? I am told I cannot do an LLC.

[@parleygentry5008]

Super clear explanation. Setting the numbers up like that gave me a visual idea of how I should set up the business

[@gummybears-n-crime1317]

This was excellent and helped me decide to open an s corp vs LLC as an independent contractor

[@rebecanelson207]

thanks for being so detailed oriented and having it all clean and organized--and for answering all these important questions.

[@lunamorris2091]

Would like to see more of these types of videos where small business owners can get educated on how to understand financials and use them to improve their business

[@MrElvin026]

Very well explained, I’m CPA in Puerto Rico and is very important get an advisory from a CPA.

[@adamkalon7584]

I rearly leave comments but you are great! This is EXACTLY what I have been looking for so long. I graduated from financial university in Europe but now I live in the US and I need to understand your microeconomy regulations work. Your video is just a great example of top notch teaching, it helped my to obtain more clear vision on how to run my own company and what type of entity to choose. I didn't even know about QBID. I'm going to comple your whole course. Thank you again!

[@ashburnconnecttv7860]

Rarely.

[@adamkalon7584]

@@ashburnconnecttv7860 I wish I had someone who would correct me since I’m trying to improve my spelling. Thank you for noticing!

[@cathyjohnchang9812]

Excellent job! You explained very clearly with a clean easy understanding spreadsheet. Really appreciate it.

[@anitacobb1973]

Outstanding!! I agree with Roger below. You provided the clearest explanation to date!!

[@xpress-notary-pro]

☑ I don't leave a lot of reviews, but this video and another one in your list completely lifted the scales from my eyes. I was blind and now I see! You helped me make a decision about whether to go the S-Corp route and saved me from making a huge mistake. Thank you for bringing free content that is completely useful on its own. I have you bookmarked. I definitely want to take your course once I get my business up and running.

[@cynthiagarcia2784]

Same as you. I’m started by own business and this has definitely saved me lots of money before starting.

[@shaunquilty8201]

You did a great job, explaining how each entity pays their taxes and what is required but you didn’t explain to me any advantages of what each one offers so you just wasted like an hour of my time and now I’m super convinced on why it’s just good to pay so I wanna do your taxes. Thanks.

[@EvangelineNavarra-p7r]

I am from the Philippines and want to understand more about this topic. Thanks for the knowledge.

[@Trader_Father]

new LLC and this is exactly what i need to know, i am going to the s corp after watching this video.

[@pazsugarspice]

Your videos are excellent. You have a dedicated agenda without jibber jabber, clear video and audio, and speaks to people who are not CPAs. I've seen a few other videos and you mention about book royalties may not be taxed as self employment, as it is intellectual property and not a service. I would love to hear more about this topic. I have set up my business as an author as a SMLLC, but was considering being taxed as an S corp if I do exceed $40k.

[@amyroberts3922]

We are thinking about converting from a LLC to an S Corp. This was extremely helpful. Thanks!!

[@fromjaxflorida]

I'm trying to understand business taxation and this video helped me to understand the differences. I'm a visual person; listening and reading don't help me. Thank you.

[@alihakim8680]

Navi, this was an absolutely phenomenal explanation compared to everything else I’ve seen on YT. I appreciate the disclaimers regarding QBI and SE deductions, since many people leave these out and don’t mention it. Your clear ability to share knowledge makes me want to use your course. Thank you!

[@islandst.maarten7081]

I'VE WATCHED A LOT OF VIDEOS BUT THIS ONE WAS VERY UNDERSTANDABLE. THANKS

[@briemalagarie223]

Great job explaining this! I have used this video to help so many people understand these differences!

[@TXRoeJogan]

This is exactly the kind of video I was looking for, super basic but thoroughly explained, thank you!

[@Narski6]

Excellent explanation. Big big thank you for clarifying the differences and giving a detailed example for us!

[@lavadog13]

Great video. The social security tax is more nuanced then described. There is a max amount that is held per year. I think you want to max that out as many years as possible to get max social security benefits at the end of the day.

[@bluedreamkush2392]

By far the best explanation on youtube. And the excel layout helps tremendously.

[@NaviMarajCPA]

Glad it was helpful!

[@Joey-bq4hu]

Thank you - this is exactly what I was looking for in the way of S-Corp tax savings explained and broken down!

[@xcalybur75]

Fantastic info and great pacing. This is hard stuff for most people to wrap their head around and you did a great job. The only thing that would make it marginally better and might not be worth the time is to put together some slides you can show occasionally during the presentation, but I understand if it isn't worth it.

[@Mukimuki28]

Best video on tax differences !! thank you for taking the time to do this video 👏🏻👏🏻👏🏻👏🏻

[@garlictoastreviews]

In another video I saw the guy said only SCorps get the QBID so I’m glad I found your video

[@mtmetzger]

Excellent video! Thanks for being so precise with your explanations. You are really taking the stress out of the entire process.

[@carlosgarcia4012]

Hi Navi. This video is great. I have tried to find a video with an expatiation like this one you just did and I have not found anything like this. You are great. Thank you so much!!!

[@nasariosantos1117]

Navi, you do an excellent job teaching the layman ! 😊

[@freddycuevas6595]

Great Video! Thank you. If anyone knows in the S corp case there was 40k of Income and the rest Business Income 60k. The employer paid Medicare and Social security on 40k but didn't pay anything on the Business income of 60k for medicare or social security?

[@finalflare2049]

Best video online. Please keep up with the visuals of your explanations. It helps visual learning a ton.

[@vebaharris5421]

Thanks! Very educative presentation. The visuals really made it clear. 👏

[@ronaldoquiroz1023]

This was so helpful. Its my first video from you and i'm definitely gonna try to binge watch the rest of your videos. good job brother!

[@Quentyn73]

Nice explanation, thank you. Just one clarifying question - the SP is eligible for 50% deduction of the SE tax, which I don't see reflected on your spreadsheet.

[@chilizchilizz3905]

Appreciate the information and I don't think it's boring at all, exactly what I want to know. You mentioned paying your own taxes at quarters, from what $ account is paying from, personal business account? Appreciate the information

[@emmanuelcovingtoable]

Thank you for this information! You simplified a very confusing topic.

[@fixitfredhandyman]

extremely clear about all three categories. thank you.

[@dsmtnr95]

Thank you for this clear concise breakdown. Really made it all make sense. Thanks!

[@RobertCF428]

Thanks for the video. Nice Fastback in the background ;). I once had a 66' Coupe.

[@NaviMarajCPA]

My favorite comment by far!!!!

[@josephinebardot8403]

I’m more than happy to discover this channel. I need to thank you for your time for this, particularly a fantastic watch!! I liked every little bit of it and I have subscribed you to look at new posts all the time.

[@nandakumars2845]

Spot on, exactly what I was looking to learn. Thank you for your time in helping everyone! I am new to forming an LLC and learned a lot through your videos. As an S-Corp, when exactly can you withdraw the "distribution" amount (60k in your example). You pay taxes on 88k anyways - is there a reason to leaving that distribution amount there? At the end of your video, you suggest that over 60k can go to a Roth. What about Pre-tax retirement contributions? SEP IRA not an option for S-Corp?

[@cynthiagarcia2784]

This is a great question. I would like to know this as well.

[@thunderbomb501]

Do you have a link to that spreadsheet? Amazing video, I watched it at 1.5x speed and didn’t need to rewind it was that straight forward ❤

[@TL-pe4jv]

This information was very informative. You broke it down so that the ordinary guy makes sense of it. The supporting websites tied it all together. I appreciate all the effort you put into your presentation.

[@NaviMarajCPA]

Thanks so much for the feedback. Appreciate you!

[@LucasMidas-o9j]

Awesome video! Thank you for making this clear!

[@jocoll75]

Best video on tax differences.

[@hot.alaska]

thank you for taking the time to share your knowledge on this

[@justinleomartin]

can you please upload that excel sheet and can you do a video comparing C Corp

[@yanamiakshyla8498]

Thank you so much, Navi! This video is GOLDEN!!!

[@denbestenmathchannel4180]

Great video! You do a nice job explaining a complicated topic. Thanks!

[@corystheboss]

Taxes should not be this confusing…

[@NaviMarajCPA]

Agreed but hope I was able to make it a little easier for you.

[@TengoWiskeyFoxtrot]

Agreed. Also, taxation is theft. They literally tax you 2x literally every direction you go. But then they say, no dollar can be taxed twice. It’s bologna

[@savageazzligee5970]

He actually explained it so smoothly in my opinion. Plus he giving good examples with easy to understand numbers and this is my first time learning about business taxes. Only part I don’t completely get is where the $88,000 came from when at first it was $100,000 then the QBID made it $80,000. I’m just confused where the other $8,000 came from.

[@nextgenerationsshow]

​@@TengoWiskeyFoxtrotHow?

[@jamisonmunn9215]

It's not, since the governments number one mandate is keeping the nation safe. Also a nation has clearly defined borders that requires people to go through a process to enter. Since the USA doesn't have those things currently all federal taxes are invalid and shouldn't be paid.

[@christopermontez6109]

Awesome info you broke down simply thanks and a pay roll company seems the way to go

[@adammichael3359]

One thing to note, that savings for the S-Corp will then be taken as distributions instead.

[@joser08rodriguez]

Great video I really liked the visual chart. Thank you.

[@rickcoona8368]

how does this apply to *Manufacturing* business as a new start up? it would seem that a lot of this advice is geared more towards on-line information sales , and perhaps Real estate. I am in the research phase as i have created my first line of products and am sourcing raw materials and equipment. as the saying goes, Ya Gotta start somewhere...

[@WendiMontano1986]

Whether or not you take the money from q C corp do you have to pay the taxes on your personal return? The dividends?

[@maxinedejesus9233]

This was amazing! Thank you for the clear explanation 😅

[@sedtaylor]

I'm just seeing your video, which is very informative. Three of my co-worker are going into business together and from your expertise, which one of the formations would be best for us to form?

[@FDDLERSGREEN]

So what can you do with the distribution? What is the purpose of the distribution? Can i spend it right away? Do inpay tax on the amount i take out each time, or is there limitations like i have to take a certain % each quarter? I understand its separated to pay less taxes on the W2 portion but nobody explains the what and why and when for the distribution

[@nextgenerationsshow]

@14:34 shouldn't the filing status be married filing jointly since you're adding the spouse's income? That would change everything below that.

[@katiehoponick1141]

Thank you so much!! Your video was so helpful in gaining a clear understanding of the different business models, how the taxation flows, and the importance of each part. Very Informative, thank you

[@nickoliwade]

Thank you for helping with taxes and your visuals were spot on , also keeping taxes interesting.

[@Rico-ns5dt]

Man i need me a powerball jackpot because this is exhausting 😂😂😂 great video

[@mariabell8320]

Found your post interesting to watch. I can't wait to see your new videos soon. Good Luck with the upcoming update. This KZbin channel is very informative and effective.

[@GabrielYeager]

Really helpful and great resources. Thank you!

[@wittyk8581]

Fantastic content, I will absolutely 100% come back

[@kasiwilliams5927]

Thanks for explaining I enjoyed following along the visuals and website.

[@AlexanderDeShazo]

I started an LLC partnership and I find it very difficult to find helpful information, most of it seems to be S corp or sole proprietor. Thanks!

[@edentajas1624]

Thank you so much... this is very helpful. I am a freelancer and I need to learn more about US taxes.

[@xcalybur75]

I actually had a question. If you are a Sole LLC and you pay taxes on profits as an individual, is there some kind of provision for putting some of that money back into the LLC like an S-Corp? I am guessing you pay the full taxes and you are free to put whatever you want back in the LLC. With your example, $100k profit, you want to take $50k as salary to yourself. You pay taxes on the $100k just like you showed, but whatever is left over from 50K is put back into the company as operating money?

[@donsergio2406]

I liked the explanation, but the QBI deduction confuses a lot. There so many business out there that can not qualify, that I would not show it as a typical way to write-off taxes.

[@sulldrummer5433]

I feel like I'm missing something obvious here but for an S corp, what is the down side to making the reasonable compensation to yourself as low as possible? Won't you end up paying less in total taxes (social security, medicare, AND federal income tax)?

[@RuthannAlterado]

Great explanation! Thank god I came across this video. Looking forward to watching the rest of your information. Thank you!

[@budgeting4u932]

Hi Navi, can you please share the tax estimate Excel file template?

[@PriteshRPatel-lr5uh]

what type of corp (S, C, LLC) would be best as I am starting to do more and more day trading.

[@yyvvy]

Hi Navi, can you explain why @9:17 the S-corp contribution for medicare & social security would come from the employee earnings rather than the employer earnings?

[@NaviMarajCPA]

The amount of social security and medicare taxes paid is derived from the amount of payroll issued. It doesn't have anything to do with the S Corporation's earnings.

[@dylananddaddy]

Does S Corp have to have salaried employee? My rental property is created as an S Corp and Management company is managing all.

[@n.trs1788]

Thank you so much. This knowledge is invaluable and I better understand Sole vs. LLC and not as freaked out!

[@NaviMarajCPA]

Great to hear! Thanks so much for the feedback and glad you're understanding things better.

[@shamszaynreacts1993]

@@NaviMarajCPA❤❤❤

[@rociozamora877]

Excellent presentation!! 🎉❤

[@BookkeeperNinja]

Hi Navi, Great video! I also forwarded to my clients to view. One question, is it okay to take a Payroll and Distributions as an owner of an LLC before becoming an S-corp? I won't be treated as an S-corp until 2025.

[@AnasKhan-uw7vf]

thanks mr.meraj ... thumbs up from Pakistan

[@mariesafaite-antoine20]

Very helpful! I will implement your advise

[@aliyahthegardenist]

This is my first time looking into this topic. Can you please explain how the calculator only used 12% for federal rate instead of 22% for the $80,000. Because according to the chart below the tax rate for 80,000 bracket is 22%. I thought the estimated tax would be $17600. I was lost at that point. But I love everything else about your video. ❤

[@aliyahthegardenist]

Never mind I found a video showing how to calculate graduated tax 😅

[@Puppypaws-cr4ck]

Great video! very well explained. had one question. if you do a s corp and using your example .. if john is married.. does he file that 60K held in s corp on his joint filing with his wife or does he file that separately. trying see if you can reduce your combined income bracket in paying taxes by doing an s corp. thank you!

[@bigstar111]

Thank you so much! Extremely helpful! As sole owner LLC, are the quarterly payments mandatory?

[@taxleverage]

Yes but they're based on prior year tax due, so it's possible they're not mandatory given your situation. Search safe harbor estimate payments and that's the calculation to determine the requirement.

[@TheBookOfJane]

Ok I am going to learn this stuff come heck or high water..... Thanks for your help. Great Channel!

[@Khans1199]

Very informative! But you forgot to explain the taxes on LLC withdrawals??

[@QValpo]

Fantastic breakdown, one question. If you have W2 income not related to the business, does the business income get added to the W2 income flow through the tax brackets or do they flow through the brackets separately?

[@nicweethee]

Thanks for the helpful video. Do you have your own accounting firm?

[@FabiolaJeanbaptiste-t2i]

Very informative. Thank you! How do you switch from an LLC to S Corp?

[@jlopez821able]

This was so helpful! I’m trying to decide llc or S corp for my business salon in California

[@ammadshahid7931]

All was good but I have a question related to 60/40 rule. I think 60 will be owners compensation and 40 will be shareholder distribution.

[@Itsme-eo5sw]

Question. Even though the individual may be paying less taxes as an s corp due to employer payroll taxes, wouldn’t it still equal the same amount in the end? Because the business (still your income) is paying for the taxes. Seems like the money savings would be the same regardless. Either the employer (myself) pays the tax or I (myself) pay the tax.

[@karleenaudibert35]

Everything you explained was very helpful! Thank you for sharing!

[@NaviMarajCPA]

You're welcome. Glad it was helpful for you!

[@RockyBalboa-h6s]

Would like to know what is more suitable for only a 1 employee- self owned business in Texas. S corp or LLC? What would be the best option to save in TAX money but also not too liable

[@pasolero]

Great video...very informative. Do you have recommendations for a payroll company for beginner in NYC?

[@nickp8]

You are phenomenal. Thank you for what you do!

[@catrinataylor5790]

I want to thank you for being the first person who really helped me identify the different options I've got for my business. I'm sole propritor but as I'm growing I keep trying to settle on if I'll become an LLC (solo owner) or an S corp. I've got a few mitigating influences that I still need to work out, but after this video I know the information I actually need to make that decision. Thank you!

[@NaviMarajCPA]

Hi Catrina! Thanks so much for taking the time to leave this comment. I’m happy to hear that the video was helpful for you.

[@klaracraft6641]

I agree that I love the way he laid it all out here (I'm a spreadsheet geek). I will add one thing I picked up from other videos though. On the subject of "LLC (solo owner) or an S corp": either way you would set up your legal entity/business structure as an LLC, and you can then choose whether or not to "file as" an S corp.

[@jeffkayode]

Thanks for this... I will like to know if this is also available for business registered by a non US resident?

[@riazgomez8100]

Navi!! I see many videos and feel like yours are the best to learn!! Hope to find you soon and would love to learn more from you