Yes - pass through entities like LLCs pay whatever the owners personal rates are. This is usually higher than 15%. Small and mid-sized businesses often pay more

Yes - pass through entities like LLCs pay whatever the owners personal rates are. This is usually higher than 15%. Small and mid-sized businesses often pay more than larger companies despite the progressive rates because they don't have access to legal workarounds or don't have strategic offsets. S-corps are generally the highest and they're prevalent in tech startups of course. "[The] study provides valuable data that confirms small businesses currently pay a higher effective tax rate than many large corporations." [1] The author's suggestion that you don't need profits to reinvest is incredibly naive. My company doesn't hire when profits are low. It's too risky for most companies to do that. So we have some work to do there and we should invest in our small businesses because they 1) produce the bulk of new jobs and 2) produce jobs and environments that are more rewarding. [1] http://www.accountingweb.com/tax/individuals/s-corporations-pay-highest-effective-tax-rates http://www.accountingweb.com/tax/individuals/s-corporations-...