“Reasonable compensation” has become a real hot button for the IRS when it comes to small businesses that file Subchapter S tax returns. As a business owner, it is your responsibility to accurately determine and document your Reasonable Compensation for the services you provide to your business. Reasonable Compensation is the salary or wages that you, a shareholder-employee of an S Corp, pay yourself for the work you perform for your company.

The IRS requires that all […]