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Mark Taylor
Mark Taylor, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 2308
Experience:  Certified Public Accountant
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My husband and I jointly own and operate an S-Corporation

Customer Question

Hi! My husband and I jointly own and operate an S-Corporation based in Illinois. We had a net profit of around $30,000 last year and expect to have closer to $50,000 this year. As of yet, we have not taken any salaries or distributions from the business. Now that the business has steady cash flow and reserves, we'd like to pay ourselves something. I want to set payments to us up correctly so that we don't have any problems come tax filing time, but keep getting conflicting advice about the best way to do so. Should we find a payroll service and set ourselves up as employees or should we just take a distribution?
JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: Hello? Anyone there to answer my question?
Submitted: 3 months ago.
Category: Finance
Expert:  Mark Taylor replied 3 months ago.

Hi, my name is Mark. I will be happy to help you with your questions. One of the requirements of a S-Corporation is that you must pay the officer's a reasonable salary. So you should be paying yourself payroll. Payroll services are usually reasonably priced.