Onlytonylopez Sextape - Brightlocal News
Courts have consistently upheld the irs’s authority to reclassify distributions and other payments as wages when a shareholder-employee fails to take a fair salary. By distributing profits in the form of dividends rather than salary, an s corporation and its owners can avoid payroll taxes on these amounts. A recent decision made by the us court of appeals for the eight circuit reaffirms the irs re-characterization of s corporation distributions as wages.
Several court cases support the authority of the irs to reclassify other distributions to a shareholder/officer/employee as a wage expense which are subject to employment taxes. Due to the increased pressure by the irs in this area it is best to be conservative when determining the amount wages paid to officers of the s corporation. The additional taxes and penalties that can be …
