Your corporate surplus is the corporation’s net income after contributing to pension and profit-sharing plans and paying salaries, expenses, and taxes.  This profit can be utilized to produce more profit for you.

 You can use that money to invest in common and preferred stock and the dividends that are paid to the corporation are 70% tax-free if you’ve had them for 45 days or more.

 Just as if you were investing your personal income, you’ll want to be very careful investing the corporate surplus.  Don’t be an aggressive investor if your company can’t afford the risk that comes with it. 

 You can use your corporate funds to invest in growth stocks and mutual funds that will help you produce long-term growth and capital gains.  This helps you maximize income and minimize your taxes, which is known as asset allocation.

 Until your corporation has at least $25,000 to work with, you might want to handle the investment on your own – provided you have the time to spend researching the best investment opportunities. 

 After $25,000 you will want to work with someone to manage your investments and maximize your returns.  The Internet provides you with the tools you need to research and invest without having to give up control until the investments become too large for you to handle.

 It’s important to include common stocks in your corporate investment portfolio.  The reason for this is that the dividends paid on these are 70% tax-free, while interest on bonds is fully taxable.