Pathfinding Consultants

If you own an S-corporation, the IRS requires you to pay yourself a reasonable salary for the work you perform — before you take any distributions from the business. This is not optional, and it is one of the most actively audited areas of S-Corp tax compliance. Getting it wrong does not just create a tax problem. It creates a payroll tax problem, an interest and penalty problem, and in some cases a reclassification problem where the IRS recharacterizes your distributions as