10/23/2026
An S-corp can save you money—but your salary needs more thought than “I heard 50% was fine.”
In Part 2 of this week’s Owner’s Office Hours, we’re talking about reasonable compensation: what it means, the consequences of paying yourself too little, and how paying more than necessary can reduce potential savings.
I also cover compensation studies, payroll processing fees, a separate business tax return, and the cash you need available when payroll runs.
Paying taxes throughout the year can mean less left to pay at filing. But you still need to plan for income tax on the remaining business profit.
If you haven’t watched Part 1, check it out for home office reimbursements, accountable plans, and owner health insurance.
Have a business money question? Leave it below!
This is general educational information, not individualized tax advice. Reasonable compensation and overall tax results depend on your circumstances. A compensation study supports your salary decision but doesn’t guarantee IRS acceptance.