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I don't get the analogy. With EC2 you either lose your data when rebooting, or you have to use network storage (iSCSI) which has advantages and disadvantages.

BTW, when I invest in a corporation, I do get double taxed. The profits are taxed at the highest possible income tax rate, then I pay 15% tax on the distribution of profits.

Of course if I work for that corporation, I opt to take the "profits" as a bonus. I pay all the taxes in that case, but at least there isn't double taxation.

But there are a myriad of scenarios where booting to a AWS image, effectively a CD, is preferred. Having a non-writable filesystem is cool, where that non-writability allows for the saving of temp files and such, but if it were ever compromised, I would just reboot it, and it's exactly how it used to be. Even smarter, I would boot up another clean instance and take that one down, then remap the elastic IP to cut over.

For data that must be stored, I can use a EBS, or a database instance.

Like the grand-parent said, you pick what makes sense. Saying that ephemeral storage is a bad thing would be true if that were all they offered, but it isn't, and it ephemeral images are sometimes preferred.

A reboot doesn't cause you to lose data on your ephemeral storage. I think you mean "stopping" an instance and then "starting" it again (on another host), not rebooting it.

You are correct, that is what I meant, but I've taken to calling it 'rebooting' because all the intro-to-EC2 stuff I've seen listed their "how to reboot the instance" instructions as stopping and starting it, so I figured it's the appropriate vernacular, however incorrect it might otherwise be.

I'll pick this comment out of the many to reply to rather than spamming - you do not lose your data when you reboot an EC2 instance. Local ephemeral stores are retained unless you terminate or 'stop' your instance - but a reboot is just fine.

"Local ephemeral stores are retained unless you terminate your instance"

That sentence makes no sense to people with no AWS experience. But if you give someone with Linux experience secure shell access to a DigitalOcean server they can hit the ground running.

If you shut down your server you lose the data that was stored on the local drives, no different to DO. If you shut down your droplet on DO you lose the data stored on the local drives (in fact DO now scrubs the disks on shutdown after a recent security screw-up). The only difference is that most folk on AWS use EBS storage (something which DO still doesn't offer) which allows you to have drives which can continue to exist after your server is no more and allows you to attach more storage without getting a bigger server.

It's not rocket science:

instance = virtual server ("droplet" in DO speak)

terminate = shut down

ephemeral store = local disk

An EC2 instance is just a virtual server so anyone who knows Linux, Windows, BSD or even Solaris can "hit the ground running" there too.

When you say shutdown are talking about issuing commands from the command line like 'shutdown now' or 'reboot'? Because with Digital Ocean you DO NOT lose your data when you issue those commands. I know from experience.

Terminate in EC2 is basically the same as the Destroy call of DO. In both cases you will destroy the data stored locally. Rebooting an EC2 instance will not result in data loss, same as DO.

I really appreciate your comment. I feel really dumb for not knowing that. I always assumed the worst. Want to reboot and instance to just check the init process?... can't do that on Amazon. I'll pick a different platform. I was way off base.

That being said, do they dump your instance if they reboot the physical server? I was under the impression that "Oh we want to upgrade they hypervisor kernel, your instance is toast", was fairgame/default on Amazon.

> That being said, do they dump your instance if they reboot the physical server? I was under the impression that "Oh we want to upgrade they hypervisor kernel, your instance is toast", was fairgame/default on Amazon.

Nope. In most cases, you get two weeks warning before a physical host is decommissioned. I've gotten as little as 24 hours (guessing it was a more significant than usual hardware issue).

When that happens, you can just stop the instance, then start it again. That moves it onto a new physical host. If you don't do it in the 14 days, Amazon does it automatically. No loss of data, and just a few minutes of downtime if your startup scripts are OK.

You mean they copy the ephemeral disk over? Really?

Amazon should really advertise this, if that is the case. I was under the impression that Amazon couldn't be relied on as a VPS.

If you get a notification that your instance is going to get terminated - then yes, you can stop/start, but then you will lose ephemeral disks (but not EBS volumes). If you get a notification that your instance is just going to get rebooted, then nothing's going to get lost.

As I said above - the terminology can get hairy pretty fast. It's valuable to take stock of what you really need persisted, and what use can be made of 'scratch disks'. Local ephemerals are fast and cheap (included in the price of any instance). They come with the operational overhead of needing to rsync data off of them yourself if you want to retire that instance however.

No, not ephemeral disks. They're typically used for temp files, caches, etc., or servers you can afford to lose. EBS volumes are persistent and work just fine between stop/starts.

Eh, don't feel dumb. I can't really claim it's totally unambiguous and not confusing. Rebooting the physical server should only reboot your instance.

Rebooting the physical server does only reboot your instance. The your instance is toast thing is for hardware failure.

Double taxation isn't related to the salary you get paid but the dividends that a corporation pays out. A corporation pays taxes on income then when it pays it out as dividends you pay taxes on it again, hence double taxation. As far as I'm aware you are unable to deduct dividend payments from corporate income for the purposes of taxation.

So no, its not FUD in that case at all.

Alright, I'll bite.

You're right. But you're not going to avoid the stock market (where you might get paid in dividends) because you want to avoid double taxation. However, when forming a company for the first time, you'll hear double taxation cited as a reason you might not want to form a corporation. This is stupid because you're not going to pay yourself in dividends. Of course there are many reasons you might choose one business form over another -- I'm just saying that double taxation really isn't one of them.

Likewise, if you are deciding between digital ocean and AWS -- there are many reasons why you might want to go with one over the other. One of the reasons is not because you lose all your data when you restart a machine on AWS. I mean, look, I'm considering giving DO a shot for various reasons, but AWS losing my data because of some oversight in their service that DO has fundamentally engineered around isn't one of them.

In both cases, I'm not saying one is better than the other -- all i'm saying is some distinctions are subtly stupid to the point of being manipulative. As in FUD. That's my full thought process on this matter, I don't think I've got anything past that, haha

Hmm.. question for u. Say I start a corporation, with just me and another partner, and I need to pay myself... So the revenue earned by the company that's paid to me. that's taxed once by the company. And then again by me as salary. No? Isn't that how it works?

No, that is not how it works. Your salary is an expense for the company, paid before any corporate tax is paid, and thus reduces corporate tax.

A company that has $10MM in revenue, and $10MM in salary expense will pay zero corporate income tax.

A company paying its owner $10mm in salary cannot deduct all $10 million. It could probably get away with paying a six-figure salary (fully deductible), but the rest would be re-characterized as a dividend and the underlying "salary" expense would not be deductible. At the numbers we're talking about in this hypothetical, the corporation would be treated as severely underreporting its tax liability--meaning the highest penalty rates, back interest, and possibly including jail time.

His point is: salaries are an expense.

Yes and no. What the other comments are ignoring is that the deductibility of salary paid to owners is capped, precisely to avoid the shenanigans they're trying to achieve (i.e., avoiding double taxation using the corporate form).

Up to a limit, your salary as owner is deductible to the corporation. Generally, the "safe" limit is usually the current SSI maximum wage. Beyond that, the IRS is very likely to re-characterize wages paid to owners as dividends. While this actually results in a lower (direct) tax to the owner, it usually results in higher taxes to the corporation, plus penalties and back interest.

Note that this is generally true for LLCs, S-Corps, and C-Corps, though the precise rules differ based on the type of entity. You'll definitely want to talk to a lawyer or accountant.

If you run a company and are paying yourself excess profits as salaries or bonuses, you are paying payroll taxes on that money. If you have a C corp you are paying taxes on that money as dividends. If you have a pass through entity of some sort (S corp, LLC, etc) you can avoid paying payroll taxes on distributions and also avoid double taxation.

Unless I'm missing something with AWS, what oversight in their system causes you to lose data? They are quite upfront and transparent that your data does not stick around unless you use EBS.

The IRS has been cracking down on people who use that loophole.... The doctor that has $50k in FICA earning and $200k in partnership distributions. Using that kind of loophole is playing with fire. You might get away with it for life, or might get stuck with a $250k tax bill at any time.

Isn't that only the case if you are paying yourself mainly via distributions? If you are paying yourself a market rate salary and taking any profits at the end of a good year via distributions would they frown on that? Assuming you have shareholders who don't work in the business (say family) I don't see how else you could distribute proceeds back to them.

The self-employment tax covers K-1 distributions, etc. If you're inactive (not actually working for the pass-through entity, only receiving profit distributions) your taxes are additionally higher on those distributions.

In summary: typical pass-through entity distributions are typically taxed as self-employment income and subject to the SET which attempts to recover the missing employer's half of tax payments. You cannot avoid all employer's half of taxes by taking them as distributions, and whomever told you that has misled you.

Now, what you might actually be thinking here, and would be correct, is that for those who earn less than a certain income (which would place them in the top tax bracket), the effect of applying all of those payments as self-employment income generally results in a lower tax rate than the corporate tax rate, and allows for deductions that companies may not have available to them.

Interesting, that's contrary to what I've heard from multiple sources (and pretty much all literature about the subject that I can find) about S-Corp distributions (again assuming you are being paid a market salary that you would hire someone at to perform similar tasks).

"If you have a pass through entity of some sort (S corp, LLC, etc) you can avoid paying payroll taxes on distributions and also avoid double taxation."

What you're talking about does not apply to LLCs, it is a special situation only related to S-Corps. Generally speaking, pass-throughs such as LLCs all distributions are taxed as self-employment wages, except under certain conditions.

what about the none-bytes-free bandwidth ?