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https://www.thebalancesmb.com/what-is-a-reasonable-salary-for-an-s-corporation-officer-397939
Learn why a "reasonable salary" must be paid to an S corporation officer and how the reasonableness of the salary is determined. The Balance Small Business Menu Go. Starting A Business. ... you must report corporate officer salaries if the corporation's total receipts are $500,000 or more. You will need to use IRS Form 1125-E - Compensation of ...
https://www.irs.gov/pub/irs-news/fs-08-25.pdf
Wage Compensation for S Corporation Officers . FS-2008-25, August 2008. Corporate officers are specifically included within the definition of employee for FICA (Federal Insurance Contributions Act), FUTA (Federal Unemployment Tax Act) and ... and the level of salary must be reasonable and appropriate. There are no specific guidelines for ...
https://www.hallkistler.com/s-corporation-officer-must-take-a-salary/
That’s not an easy question. A professional with an advanced degree who takes a salary of $30,000 a year for the full-time management of an S corporation generating $500,000 in net income would be suspect. But taking a salary of $175,000 a year for a 40-hour week might not be. In arriving at a reasonable salary, the IRS and the courts could ...
https://www.upcounsel.com/s-corp-salary
1. About S Corporation Shareholder Compensation. 2. S Corporations and Employment Taxes. S corp salary refers to the pay that shareholders receive as compensation for their investment in the S corporation and/or their involvement in the daily operations of the S corporation. Reasonable compensation for the shareholders of S corporations is a ...
https://www.irs.gov/businesses/small-businesses-self-employed/s-corporation-employees-shareholders-and-corporate-officers
Ghosn v. Comm’r, T.C. Memo. 1995-192. Purported “loans” from S corporation to its sole shareholder, officer, and director, were wages for purposes of FICA and FUTA taxes. The loans were unsecured demand notes bearing no interest, loans were made entirely at the discretion of shareholder, and the shareholder regularly performed substantial ...
https://www.nolo.com/legal-encyclopedia/s-corporations-salaries-an-irs-hot-button-issue.html
It's up to the people who run an S corporation—its officers and directors—to decide how much salary to pay the corporation's employees. When you are employed by an S corporation that you own (alone or with others), you'll be the one making this decision. ... For example, a CPA who incorporated his practice took a $24,000 annual salary from ...
http://www.scorporationsexplained.com/average-s-corporation-salaries.htm
https://www.picpa.org/articles/cpa-now-blog/cpa-now/2020/12/16/s-corporation-reasonable-salary-explanation
Say your 100% owned S corporation will make $200,000 in profit prior to any W-2 wages paid to you. Normally, you would take $130,000 as W-2 wages and withdraw the rest as nonwage distributions; the $70,000 of remaining profit flows through to you and your taxable income is only $186,000 ($130,000 W-2 plus $56,000 ($70,000 multiplied by 0.8).
https://evergreensmallbusiness.com/s-corporation-salary-rules/
S Corporation Salary Rule #2: The FICA Limit. Another common rule is to pay a shareholder-employee the year’s FICA limit or the business profits, whatever is less. In 2017, for example, the FICA limit equals $137,700. So an S corporation that made this amount or more would pay its shareholder $137,700. Note: Just so we’re clear here.
https://evergreensmallbusiness.com/setting-s-corporation-shareholder-employee-wages-to-zero/
Completely updated for 2017, the Five Minute Payroll ebook explains how to do simple cookie-cutter payroll for most one-employee S Corporations using base salary amounts of $10,000 a quarter or $16,000 a quarter. (These amounts mean annual compensation levels of $40,000 or $64,000 for a shareholder employee and this may work, especially if ...
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