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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: Neeka who wrote (116618)	5/27/2005 1:12:42 PM
From: Ilaine	Read Replies (2) \| Respond to of 793739

The salary paid in a Subchapter S corporation shouldn't be "arbitrary," because you pay SS tax, FICA and FUTA on Subchapter S salary -- SS tops out but FICA and FUTA don't. So the IRS does have rules about this. Maybe not enforced due to not noticing what's going on, but that doesn't mean if they did take a look, they couldn't do anything. Example - if I, as a lawyer, take in enough to pay myself $75,000 salary one year, and nothing as a dividend, next year they'd think it strange if I paid myself $25,000 salary and $50,000 dividend. Caveat: I am not a CPA. I just was alerted when you said "arbitrary."