Art Werner: Navigating Business Structure Decisions Amid Tax Law Changes | Quick Tax Tip [Video]

We are anticipating changes to tax laws that could significantly impact clients, either positively or negatively, depending on the structure of their businesses.

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One major consideration is the type of business entity the client operates. The options include sole proprietorships, partnerships, and corporations. Within corporations, there are further distinctions: C corporations or those that have made an S election.

For limited liability entities, clients may choose to have the entity taxed as a partnership, sole proprietorship, or corporation by making the appropriate elections, such as the “check-the-box” election or an S election.

Many of these choices were influenced by the Tax Cuts and Jobs Act (TCJA). For instance, the reduction in the corporate tax rate from 35% to 21% created a strong incentive for businesses to consider the …