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Officials at ABC Supply Company are responding to critics’ allegations the company paid no state corporate income tax between 2005 and 2008.
The allegations are false, ABC officials say, and taxes were paid in a different way because of the way the company is structured, as an “S Corporation.”
The Institute for Wisconsin’s Future recently reported that “ABC Supply paid exactly $0.00 in state corporate income tax in 2005, 2006, 2007 and 2008, according to the state Department of Revenue.” The institute does not specify how it believes ABC Supply avoided paying the state taxes, but implies a method by stating “state tax law is full of plenty of loopholes.”
Other websites have picked up on the allegation in the last few weeks.
However, Scott Bianchini, tax director with Beloit-based ABC Supply, said the Institute for Wisconsin’s Future jumped to a conclusion without thoroughly checking the facts.
He said during the years in question, ABC Supply Company was an S corporation. According to the Internal Revenue Service website, S corporations are organized to pass corporate income, losses, deductions and credit through to shareholders. Those shareholders for S corporations report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates.
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