Unless the professionals are C corps they do flow thru.
Reader comment on: Bloomberg, Taxes, and Job Creators
Submitted by Lyle (United States), Jul 20, 2012 17:12
Basically you can organize a business as a sole prop, a partnership, a S corp or a C corp. All but the C corp flow net profit to the owners. The C corp pays the corporate tax instead at 35% so this is why so many are S corps. So the physician may pay themselves a salary, but in addition there will be an S corp flow thru to the individuals tax return, the net income of the practice does need to be taxed somehow. So unless the physician works for a large group practice it does flow thru, a large group practice means the physician is an employer in the same sense that a plant manager is.
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The Future of Capitalism replies:
Or the physicians work for a non-profit like a hospital, as a lot of them do.
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