More Taxes for the Rich…and Small Business?

Published November 29, 2012

| FOXBusiness

Lisa Goodbee, president of Goodbee and Associates, started her business in 1994 with her then-newcomer’s sense of optimism and determination. Nineteen years later, she says she considers herself fortunate, with annual company earnings of $400,000.

“I worked hard for many years to build a company,” she said. “It’s a success, and there’s a price for success.”

That “price” she speaks of is set to go up when President Obama’s agenda to raise taxes on those who earn more than $250,000 annually kicks in. Because Goodbee and Associates is registered as a sub S Corp., the earnings from her company roll onto Goodbee’s personal taxes.

However, Goodbee said she doesn’t mind.

“I can afford it,” she said. “I am fortunate enough, and I don’t think that anyone in that tax bracket will see this make a huge difference.”

But for Andrew Guzman, creator of Miami- based startup clothing line MADE Kids, that money matters.

“I am legally established as a corporation, and earn a wage through my business,” he said, noting that his business falls into the $250,000+-earners bracket.

 “If they raise taxes in any form, the less returning investment I have.”

Guzman feels his hard-earned cash is better in his hands than in the Uncle Sam’s, so he can directly invest it in his seven-person business.

“We can probably get a higher return on investment than the government can,” he said. “The hardest thing to do is save. Income for those in the middle class is disposable income. By taxing them more, you are taking food off their table. In my small business, I won’t waste it. The government will parade it.”

His theory is that as a small business owner, he holds himself more accountable for that money than the government would be.

But for Centennial, Colorado-based Goodbee, tax rates are not a driving factor when it comes to making business decisions.

“The tax rate is not a consideration when I hire, fire or take on new contracts,” she said. “When you’re running a small business you think ‘What can I do to grow the business?’ and ‘How can I meet the needs of my clients? I don’t view this as life-changing, or changing the way I do business at all.”

URL

http://smallbusiness.foxbusiness.com/entrepreneurs/2012/11/29/more-taxes-for-richand-small-business/