Quote:
Originally Posted by whell
Businesses are not seeing those kind of rates, particularly small businesses. Due to the rise of bad debt many small to medium size businesses don't have access to the credit they used to because the lender's sphinkters have tightened considerably. A $100K loan is in the 6 - 7% range in today's market, if they can get the loan approved. Then of course if they are successful converting the loan asset into a product, there's another 10 - 15% tax on top of any gains.
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Once they've written off salaries, depreciation, interest expenses, etc., they are indeed taxed upon their profits (as they should be). I suspect you probably know some people with small businesses. I do. They are very adept in writing off every imaginable "expense" and keeping their tax burden low to nonexistent. In many instances, the small business exists solely to write off its expenses against their other profitable enterprise(s).