Cheney and Bush Send Mixed Messages on Subchapter S Corporations

[The_Gopher]

Bush and Cheney send mixed messages regarding Subchapter S corporations. From their respective debates:

Cheney: While you were in private practice in law and as a senator, you had the advantage of a special tax loophole, Subchapter S corporation, which you set up so you could avoid paying $600,000 in Medicare taxes that would have gone into the fund.

Bush: Most small businesses are Subchapter S corps. They just are.


So Cheney is deriding something, and Shrub is saying that's just the way it is? Which is it, boys?

[no name no slogan]

1. I think we have two guys who don't have a f*cking clue....

...about how small businesses operate.

If you're a business owner who has employees, you DON'T set up as a sub S! Setting up as a Sub S still leaves you open to personal liability for damages caused by the business-- even if those damages exceed your investment in the business. Most Sub S businesses don't stay that way for long-- they usually reincorporate as Sub Cs or LLCs or some other entity which limits their liability.

Most new businesses are setting up as LLCs (Limited Liability Companies), which isolate the owner(s) from any liability over their investment in the business. LLCs typically have their own Tax IDs and file separate tax returns (unlike Sub S, which are usually filed with the owner's personal taxes).

I admit I don't know a lot of business owners right now, but the only Sub S ones I knew were either freelance tech contractors or insurance/real estate salespeople, who tend to work alone or may have an office person.

It's obvious Dubya doesn't know a damn thing about small business (he's run every one he controlled into the ground), but you'd think the Dick would know better. :eyes: