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View Diary: Analysis: Dow 30 companies show what a joke calling corporate tax burden 'heavy' has become (70 comments)

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  •  Why incorporate? (1+ / 0-)
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    Eric Nelson

    I suspect you know the answer - unlike partnerships, corporations (and a variety of other entities) limit the liability of the people who own the business.  If a general partnership run business fails, the partners could lose their house.  If the two partners instead form a C Corp (or a LLP), then they don't lose their home when their business goes under.

    I could see taxation as the price of limited liability, but on the other hand, I don't know if it makes sense to measure the value of the legal protection offered to the individuals by the amount of income earned by entity.  It may be the best available measure, though.

    Please note I'm not saying we should get rid of capital gains taxes or using the double taxation argument.  I think we should treat long term capital gains like all other forms of income (short term capital gains already are treated this way, as I understand it).

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