[ilgipper]

Thank you so much for this post. This is true. As an LLC member, individuals are taxed annually for money the company has earned, even if it is not paid out to the members. I used to get hit with this every year until I sold my business.

[Daus]

I used to get hit with this every year until I sold my business.

And that is the final insult in his plan. Once Joe goes to sell his business. Let's say for 1x revenue 5 years later when he is a $2.5 million top line business. Right now the capital gains rate is 15%, so he will have to cut a check to the feds for $375,000... bad of course, but.... If Obama doubles the capital gains rate, that check is now $750,000 to the feds. That's real money.

So what they say! Look it all the money he 'gets' to keep. Well that extra $350,000 is now money Joe will not spend to start his next business.