What is "Reasonable Compensation"?
Reasonable Compensation is a current high priority issue for the IRS concerning all corporations, especially S corporations
Wage Compensation for Corporation Officers
Corporate officers are specifically included within the definition of employee for FICA (Federal Insurance Contribution Tax Act), FUTA (Federal Unemployment Tax Act), and federal income tax withholding under the Internal Revenue Code. When corporate officers perform services for the corporation, and receive or are entitled to receive payments, their compensation is generally considered wages. Sub-chapter S corporations should treat payments for services to officers as wages, and not as distributions of cash and property or loans to shareholder or limited liability company members.
Ten Essential Business Functional Areas
When designing a business it is critical that all aspects of the business be addressed. It will not work to concentrate on sales or production or any other part of the business and ignore other parts. So, what are all these other parts that you should address?
Choosing A Preparer For Your Tax Situation
The choice of a tax preparer is not easy. All preparers are not capable of handling all tax situations. The choice of a qualified tax preparer is very dependent on your financial activities and types of income.
See how to match the preparer with the situation.
If your incomes are Level 1.
Basic tax situation, incomes from employment (W-2’s not 1099-Misc), interest and/or dividends (under $400), unemployment, and taxable pension payments. You could have simple itemized deductions
Business Help Resources
- Can You Use Independent Contractors?
- Doing Business in the 21st Century Electronic World
- How to Get Up and Running
- Notice to LLC Owners
- Ten Essential Business Functional Areas
- The Money Pump
- Understanding Risk Management
- What You Need to Know Before Starting a Business
- What You Need to Know When Your Business Needs Workers