Category Archives: S Corporations

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“Reasonable Compensation”: A Matter of Perspective Between S Corporation Shareholders and the Internal Revenue Service

Most business owners think they are undercompensated. The Internal Revenue Service does too for many business S Corporation owner employees. Their perspective is not exactly the same. The focal point is a sometimes hotly contested issue called “reasonable compensation”. The IRS has come out the big winner. Here’s the story. Since the publication of IRS Revenue Ruling … Continue Reading

So now, exactly what is “reasonable compensation?”

That’s a question many business owners ask as part of the tax planning process. That is, business owners who are also employees of their corporations. And the answer as to what “reasonable compensation”  – as determined by the IRS on audit – is based on the facts and circumstance based on IRS guidelines. And what’s “reasonable” … Continue Reading
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