If you have an S Corp, then it is absolutely crucial to know how to pay yourself correctly. If you don’t, and if you make a few key mistakes, then you could get severely penalized by the IRS. The process of paying yourself as an S Corp is significantly different from paying yourself as an LLC.
As a result, many business owners who formerly had LLCs and switched them over to S Corps do not know how to pay themselves correctly. In this video, tax expert Karlton Dennis explains exactly how to pay yourself as an S Corp to prevent getting penalized by the IRS and to make sure that you get all of the hard-earned money that you are entitled to.
Additionally, Karlton also explains a few key mistakes that S Corp owners need to make sure that they avoid when they pay themselves. Topics that are discussed in this video include: reasonable salaries, the tax benefits of paying yourself as an LLC, how paying yourself as an S Corp is different from paying yourself as an LLC, and more.
CHAPTERS: 0:00 Intro 0:35 LLC vs. S Corp: Reasonable Salary 1:17 Why Do S Corp Owners Get Confused About Reasonable Salary? 4:24 Do S Corp Owners Owe Taxes on Distributions? 5:01 How to Choose a Reasonable Salary for Your S Corp 6:52 Standard Deduction Changes for 2024 7:23 What If You Don't Actually Work in the Business? 7:55 Outro
*Disclaimer: I am not a financial advisor nor am I an attorney. This information is for entertainment purposes only. It is highly recommended that you speak with a tax professional or tax attorney before performing any of the strategies mentioned in this video. Thank you.
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