S Corporation – What Is It?

Written by Richard A. Chapo

For many small businesses,repparttar “S” corporation isrepparttar 144609 business entity of choice. The “S” in S corporation refers to a tax designation. All corporations are createdrepparttar 144610 same way under state law. A small business must then chose a tax status, to wit, “C”, “S” or non-profit. Important issues concerning S corporations are covered in this article.

C Corporation v. S Corporation

Federal tax laws automatically consider every corporation to be a “C” designation. A small business, however, may elect to be designated as an “S” corporation by filing IRS form 2553. The election must be made prior torepparttar 144611 tax year in which it is going to be effective. All shareholders must signrepparttar 144612 election.

A C corporation stands alone for tax purposes. It must file tax returns and pay taxes on profits. Profits and losses are reported onrepparttar 144613 corporate tax return and do not pass through to shareholders. C corporations can elect any calendar month asrepparttar 144614 end of their fiscal year.

An S corporation is a pass through entity for tax purposes. It does not file a tax return forrepparttar 144615 purpose of paying taxes, but does file information returns. All profits and losses are passed through torepparttar 144616 shareholders. In turn, each shareholder reportsrepparttar 144617 profit or loss on his or her individual tax returns in proportion to their ownership interest. For instance, if you own 30% ofrepparttar 144618 total issued shares, 30% ofrepparttar 144619 profits or losses must be reported on your personal tax returns. S corporations must have a fiscal year-end of December 31. If you intend to eventually take your business public, you cannot use an S corporation.

40 Million Credit Card Numbers Stolen – Failure To Encrypt

Written by Richard A. Chapo

CardSystems Solutions moronic security efforts have resulted inrepparttar potential theft of information for 40 million credit cards. Hackers were able to install a rogue program, probably a Trojan, inrepparttar 144266 CardSystems security network. This program captured credit card information includingrepparttar 144267 cardholder’s name, account number and verification code.

CardSystems Solutions is an Atlanta-based company. Prior to this incident, it processed approximately $15 billion dollars in credit card transactions each year. Small businesses wererepparttar 144268 primary users ofrepparttar 144269 system. The FBI and MasterCard International have launched investigations intorepparttar 144270 hack. It has become apparent CardSystems Solutions should be charged with gross negligence. The company failed to comply with MasterCard security regulations and failed to destroyrepparttar 144271 information of cardholders after prescribed time periods.

In a matter of gross incompetence, CardSystems failed to encrypt any of credit card data for users. This isrepparttar 144272 equivalent of your bank sending monthly account statements will allrepparttar 144273 information printed onrepparttar 144274 outside ofrepparttar 144275 envelope. It is simply inexcusable and has led to potentiallyrepparttar 144276 biggest theft of financial information in history.

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