Distributions, Dividends, and Compensation

Every February Cathedral recommends that companies review their tax strategies for the upcoming year. Many tax decisions need to be made before March 15, for calendar year companies. At the same time, most companies will have assembled their tax data for the prior year, thereby letting them review last year's tax situation with the current year's business plan and potential tax changes.

With this in mind, this year's February Topic of the Month will explore the interplay between distributions, dividends, and compensation. By understanding the difference between distributions to pay taxes and dividends, compensation may be adjusted and the compensation related taxes can be saved.

Click here to read and print the entire article in PDF.

Click here to watch this month's webinar featuring CEO and Managing Director Philip Clements as he looks to recent developments in tax law and its implications on small businesses, demonstrating why 2010 is an important tax planning year.