If you run your business through a corporation, make sure you treat it as a separate entity. Treating the corporation checking account like your own can lead to a lot of trouble. The IRS and the tax court have treated taking money to pay personal expenses as constructive dividends when the money is just taken without any corporate documentation. This can be a significant hit because of double taxation – the dividend is income to the owner and not deductible by the corporation. Tomorrow I will talk about ways to minimize the tax hit when your corporation makes money.