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Hello and thank you for your question.
You state that he started the S-corp in 2016. Given that, I'm not sure why he would be paying himself a salary from the S-corp in 2014 and 2015. If I assume he had his S-corp in 2014, that makes more sense.
You already realize that a proper salary is a requirement. If he has taken distributions from the S-corp in prior years it's almost a guarantee that the IRS would reclass these as compensation under audit. You can inform your client of his exposure and offer to prepare the required payroll tax filings. It will be up to your client as to what to do.
If your client wants your advice, I would use your best judgement based on the amount of distributions taken and his involvement with the S-corp before assisting your client in determining business risks associated with the relative likelihood of being audited. Some leeway may be afforded in the S-corp's formative years where the corp doesn't really have the earnings or extra cash to pay salaries or make distributions, but that is up to the IRS as to whether or not it wants to press the issue. You cannot advise a tax position based on playing the audit lottery, but when a client has already taken the position and is trying to measure the business risk associated with not amending you can take it into consideration. There is no absolute answer to that.
I hope this is helpful.
It's impossible to accurately calculate risk in this case because you can't perfectly ascertain whether or not the IRS will choose to audit. You also have to use your judgment, again, based on whether he took distributions and what his time involvement was. His other job helps to show he maybe wasn't working full time for his S-corp, but that doesn't mean he shouldn't be taking at least some form of salary for what he did do in an employment capacity.
If you amend 2014 and you know that his distributions are properly classified as compensation but you do not do anything about it and sign the return anyways, then you open yourself up potentially, yes. IRC 6694. You can do what some preparers try which is show some of the distributions as self-employment income for which he'll remit self-employment taxes to reduce the exposure, but that is not technically the correct way to deal with this and I don't personally suggest it.
Yes, he would face penalties on the payroll taxes if he goes to file them now. That's a given. You can write the IRS and beg for some leniency or try to use the first-time abatement waiver.
The only correct way to proceed is to file the payroll tax filings for what would be a reasonable wage in this circumstance. I can't waive a magic wand for you or tell you that it's ok to fudge it just this once or something. You have to make a choice based on what you feel your own business risk is as compared to the reward.