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Originally Posted by reefermadness
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Ha, even these big guns would drool at the deductions Agri-business of all sizes gets. I'd be really interested to see some of the financial statements and tax returns of the really big farming corporations.
As far as the knowledge the big guys have goes, it's all there for everybody and it's all scalable. The same principals and breaks that work for the big guys mostly work for the small guys. Their size doesn't get them any special perks, just the opposite actually, however a lot of these structures and mechanisms simply aren't cost effective for small businesses and individuals. It might be cost effective for GE to spend $150,000 to have a team of accountants spend 3 months on optimising corporate share structure, but it just wouldn't be worth it for the little guys. We could do it, but the tax advantage would be so small there would be no benefit. Not because the rules favour the big guy necessarily, simply because that's the economy of scale.
Just read the forbes article and yeah, some of it is due to their nature as it involves intellectual property and licencing. Stuff that wouldn't be available to the corporate structure we setup for say an energy company.
Large corps though are taxed at a high(er) interest rate, federally it's at 38% Small business benefit from a number of rate reductions they get:
38% - Basic federal corporate tax rate
-17% - Small business deduction for firms with revenues under 500K
-10% - General rate reduction
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11% effective federal tax rate for small business - less than the 12.5% achieved with the double Irish method discussed in the article
I can do that for a little guy for much less than big corporations spend on their corporate accounting departments
