A corporation, chartered by the state in which it is headquartered, is considered by law to be a unique entity, separate and apart from those who own it. A corporation can be taxed; it can be sued; it can enter into contractual agreements. The owners of a corporation are its shareholders. The shareholders elect a board of directors to oversee the major policies and decisions. The corporation has a life of its own and does not dissolve when ownership changes.



Advantages and Disadvantages of a Pennsylvania Corporation

Advantages of a Corporation

  • Shareholders have limited liability for the corporation's debts or judgments against the corporations.
  • Generally, shareholders can only be held accountable for their investment in stock of the company. (Note however, that officers can be held personally liable for their actions, such as the failure to withhold and pay employment taxes.)
  • Corporations can raise additional funds through the sale of stock.
  • A corporation may deduct the cost of benefits it provides to officers and employees.
  • Can elect S Corporation status if certain requirements are met. This election enables company to be taxed similar to a partnership.
  • A corporation pays 15% federal income tax on taxable income up to $50,000; 25% tax on income from $50,001 - $75,000; 34% tax on income from $75,001 - $100,000; 39% tax on income from $100,001 - $335,000; and 34% tax on income over $335,000.
  • A sole proprietor who filed a federal income tax return under the status of married, filing jointly, would pay 15% federal income tax on taxable income up to $35,800; 28% tax on income from $35,801 to 86,500; and 31% tax on income over $86,501.

Disadvantages of a Corporation

  • The process of incorporation requires more time and money than other forms of organization.
  • Corporations are monitored by federal, state and some local agencies, and as a result may have more paperwork to comply with regulations.
  • Incorporating may result in higher overall taxes. Dividends paid to shareholders are not deductible form business income, thus this income can be taxed twice.

Federal Tax Forms for Regular or "C" Corporations

  • Form 1120 or 1120-A: Corporation Income Tax Return
  • Form 1120-W Estimated Tax for Corporation
  • Form 8109-B Deposit Coupon
  • Form 4625 Depreciation


Pennsylvania's 2008 Business Tax Climate Ranks 27th

Pennsylvania ranks 27th in the nation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. Neighboring states ranked as follows: New York (48th), New Jersey (49th), Delaware (9th), Maryland (24th), West Virginia (37th) and Ohio (46th).

Pennsylvania's Individual Income Tax System

Pennsylvania's personal income tax system consists of a flat rate of 3.07% on all personal income. Pennsylvania's top rate ranks 2nd lowest among states levying an individual income tax. However, many Pennsylvania taxpayers also pay a local tax on earned income, commonly 1% or 1.5%, with Philadelphia well above that. Pennsylvania's 2005 individual income tax collections at both state and local levels came to $924 per person, which ranked 17th highest nationally.

Pennsylvania's Corporate Income Tax System

Pennsylvania's corporate tax structure consists of a flat rate of 9.99% on all corporate income. Among states levying corporate income taxes, Pennsylvania's rate ranks 2nd highest nationally. In 2006, state-level corporate tax collections (excluding local taxes) were $170.16 per capita, which ranked 16th highest nationally.

Home | Pennsylvania Corporation Advantages and Disadvantages | Site-Map

Interested in getting more involved in the club? Join a committee.

The different committees and their purposes are outlined below. If any of these committees interest you, and you have even minimal time to offer, please consider signing up. VMB has a long list of activities and projects for 2010 and these committees should allow our club to work on these items more effectively.

A few members have already volunteered, but more are needed. Members are welcome to join committees at any time, but we hope to have the committees functioning and have a Leader for each committee selected by the end of February, allowing the committees to be fully operating in March.

Joining a committee is a great way to get more actively involved in the club, even if you have only a little time to give.

Please respond to this thread if you are interested, or have questions.

Thank you for considering joining a committee,
Doug Pinkerton, Scott Stortz, Greg Horwath, and Lisa Ronca

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GENERAL INFORMATION

- The Officers will appoint a Committee Leader within each committee.
- All Committee Leaders will be members of the VMB Board (the VMB Board will then consist of all VMB Officers and all Committee Leaders).
- All committees should submit a brief update before, or at, each general membership meeting.

GRANT COMMITTEE

Purpose:
Raise funds for our club’s charitable and educational purposes.

Actions:
- Obtain 501c3 status for the club
- Register the club under Pennsylvania Bureau of Charitable Organizations
- Outline maintenance requirements for club’s 501c3 status, PA BCO registration, PA Articles of Incorporation, etc.
- Complete grant applications
- Organize other fund raising opportunities

MEMBERSHIP COMMITTEE

Purpose:
Organize activities that help maintain and grow our club membership.

Actions:
- Propose/plan group trip(s)
- Plan annual holiday party
- Identify opportunities to grow membership in the Lehigh Valley
- Identify opportunities to grow membership in the Stroudsburg area

TRAIL COMMITTEES (1. Salisbury 2. Trexler Nature Preserve 3. Lake Nockamixon 4. South Mtn Emmaus 5. Jordan Creek 6. Glen Park 7. Jacobsburg)

Purpose:
Work to maintain, improve, and generally advocate mountain biking at the park.

Actions:
- Propose and organize all trail building, maintenance, and clean-up work for that park
- Ensure all volunteers are have signed-in at trail work days, and that work hours are logged on the website (important for grant applications)
- Work with VMB Officers to maintain communication between government officials, land managers, and other user groups for that park