What should you do with profits from a business?

Question

If everything else is taken care of as far as advertisement, equipment, what should you do with the profits so you don't get taxed to death in the end?

Answer 1

reinvest them in expansion, or, pay them out to yourself/employees as a special dividend or bonus.

or, just leave them in the company and slap them in savings paying a decent rate.

Answer 2

What I do with the profits from MY business.  I live on them.  I do get taxed, but not much worse than if I worked for a living. And I really enjoy having my own little one-man business.

Of course you could just plow all the profits back into the business.  Expand.  Buy stuff you don't need.  Buy personal stuff and charge it to the business.  Better yet, if your corporation is big enough, make political contributions, they will come back to you many times over.

Answer 3

How much profit are we talking about? What type of business are we talking about? C-Corp, S-Corp, partnership, schedule C business? Biggest thing that I can think of to minimize profits is to buy some new equipment and take section 179 depreciation on it.