Watch this next: "You're an S-Corp, Now What?" kzread.info/dash/bejne/daSsktabf8jInw.html

This is one of the better videos on reasonable compensation, other videos are 20+ minutes long and give way too much detail that aren’t necessary

This foo talking all slow and stuff when he explains the most simple thing… thinking we’re idiots or something! That’s me. I’m an idiot. Great video and thank you

dang! finally someone made this easier to understand! thanks dude. keep making videos!

So glad I found this channel! Great content and easy to understand explanations of very confusing topics. Thanks!

This was a great video and thorough explanation. Thank you all for your hard work getting this info out there.

I should have watched this type of content 8 years ago when I started my business. I've wasted so much money because I was doing things poorly. I've made the gov very happy though. Thank you for the great, easy to understand video!

This channel really is the best at explaining!

Cleared up any confusion I had with paying myself thank you

Loved the explanation clear simple and concise

Thanks for the insights and the 1/3rd rule of net profit is a good guide for reasonable compensation

Your videos are more informative and easy to understand than I've heard from any accounting firm so far. I live the 1/3 rule, I'll be using that based on last year's income after expenses. Thank you. Keep it up, I'll be watching :)

Very helpful and well presented. Thank you.

i just subscribed and im loving it thanks,

Very helpful! Thank you

Great video! Very informative.

This video is one of the main reasons you're gonna be my account in the very near future. You're my guy! 👍😎

@LYFEAccounting

3 жыл бұрын

Man I appreciate this comment so much, you don’t even know 💯

@JusDaFactstv

3 жыл бұрын

@@LYFEAccounting I'm telling you, you are my guy. I came across your channel a few months ago when I first seriously considered going into business for myself. And by watching your super informative content, not only did I realize that I should do it, but that you were giving me the crucial info on how I could do it. I'm telling you the God honest truth. You and LYFE accounting will be my CPA solution. #FACTS

Thanks for your advise.

@LYFEAccounting

3 жыл бұрын

No problem!

What's reasonable is I would rather pay myself at a lower tax rate.

Thank you for the video. How do you determine your net income is your monthly sales fluctuate?

I know a guy who brought in 550k paid himself 600wk and paid only 7k in taxes in Fl

pretty useful information. like from me! thank you

Ty

Nice.👍

thanks. is there any tax software you recommend for small CPA firm? and would you please give step to step guidance from how to prepare tax return to final E-file the return. thank you .

I have a question. So i recently set up an scorp that became established at the end of December 2023. I was self employed all of 2023 and only recently started my scorp due to other people i work with telling me i would pay tons in taxes if i dont. My question is, will i still be able to take advantage of taking a salary/distributions for 2023 even though i never paid myself via payroll or anything like that? Will i be able to take advantage of my scorp tax savings for the 2023 year or is it too late? Thanks.

How do you setup a payroll system for 1-person S Corp? Do I simply set a date in a month to withdraw $$ to my personal account?

Great, Pennsylvania.

My tax guy opened up a s corp fir me sinds I am a 1099 truck driver, are you saying I should have opened a llc first and then a s corp ? I make 90k+ a year

Hi I just have a little question. Can you pay yourself a reasonable salary in form of 1099-NEC? Or it has to be W2? Thank you so much.

Can I start to run payroll while waiting for IRS to get back to me after I sent the S Corp form?

I'm thinking of forming a holding company/s Corp to hold investments like stocks in other companies. It's not much so the income will be peanuts to begin with. What would I pay myself then since it's just me as an owner? I would appreciate your insight and advice.

Great video and thank you. What if there’s a net loss. How do you determine the salary? Although the company is not yet profitable, the business is generating revenue.

@RandoPandaSmiles

6 ай бұрын

You prob wouldn’t do an S-Election until the business is profitable. Wouldn’t make sense otherwise. Just run it as a Sole Prop until it produces.

do you still pay if you have no capital in bank or loss?

This is a really good explanation. Does my s corp need to set money aside for taxes? It sounds like it doesn’t. Can you make a video on owners draw and how that is taxed?

@RandoPandaSmiles

6 ай бұрын

He explained how owners draw is taxed in this video. Watch again. And yes, you always need to set aside money for taxes.

I need to know actually how to pay myself. Write a company check then pay payroll taxes online?

So S Corps would pay distributions quarterly? Those distributions go on the shareholders k1?

Good evening mr Sherman, I have a question for you. I switched to an s Corp because my cpa suggested it. Say my business makes 150k take home 80k salary. I’m trying to buy a nice house. What income will they count? Personal or both? What am I actually worth? Thank you 🙏

Can you do my taxes for my small roofing business llc

Nice video. Can i pay myself as a 1099 contractor?

Can you do a video on distributions for an S-Corp? And how it relates to this video? My accountant told me that everything I pay myself can be classified as a shareholder distribution. And thus can avoid being paid a “wage” and owing SE taxes.

@stephengardner5791

3 жыл бұрын

Text his Admin for support

@LYFEAccounting

3 жыл бұрын

That's pretty advance and specific, you should consider working directly with us once we offer our services again

@asmoov

2 жыл бұрын

@@LYFEAccounting when will that be I’ve been on the wait list for quite a while

@ass2mouthallday

Жыл бұрын

You have a bad accountant.

@governmentprocurementsolutions

Жыл бұрын

Your acccountant is going to land you in federal prison. Get a new accountant.

How should we pay ourselves? Is simply writing a check from our business checking account to ourselves sufficient? Also would you recommend this on a biweekly or monthly?. I will be starting an online apparel store and is preparing to launch soon.

@LYFEAccounting

2 жыл бұрын

Hey Nicole, what kind of entity are you? My answer would depend on that.

@stephanieho3686

2 жыл бұрын

@@LYFEAccounting same questions for an S-Corp

@user-ld1vv2oy1u

2 ай бұрын

I am also in the same boat as you, how should we pay ourselves. I also have a business partner so how would that work as well ?

in the example, isn't the full $150k subjected to federal & state income tax?

@governmentprocurementsolutions

Жыл бұрын

No because it is not income if you dont pay it to yourself and it's sitting in a corporate bank account. Doesnt become income until you distribute it. However, you do still need to pay sales taxes for your state and federal.

What if the company only makes $20k/year can it still be an S Corp?

so how does the money actually get from the business bank account to mine? HOW do I pay myself? my bank will not provide me with paperwork showing how much I withdrew for the previous years taxes, so how do I pay myself? Do I need to purchase a payroll app??

@chrisfitforever

2 жыл бұрын

Get a payroll service like gusto

@raymondayala5355

Жыл бұрын

Yep. Gusto and Square have the best payroll services for 5 employees or less. Quickbooks and ADp are for more employees

When do you think you guys will be back to accepting new clients?

@LYFEAccounting

3 жыл бұрын

We're finishing up some HUGE programs here that will likely release in mid-Q3 & will accepting new clients shortly afterwards!

1/3 of net profit? That could be very low for some businesses.

If you put your self on a salary can you you just pay yourself once per yr for the 50k instead of using a payroll company?

@alexmendoza6168

2 жыл бұрын

Yes you can

So I started my own home-based Real Estate business last year. I pay myself a commission similar to what I was as an agent so the business can keep the difference. Can’t I just 1099 myself as other brokers due to real estate agents?

@raymondayala5355

Жыл бұрын

You can but it’s not the best option as you need to take a salary since you’re an “employee” of the company. Independent contractors are NOT employees.

@governmentprocurementsolutions

Жыл бұрын

For an S-Corp, you need to file a W2 for yourself otherwise you are not technically an employee and not paying employee wages or withholding properly.

what if you dont make revenue or net income? wouldnt need to pay a reasonable salary, correct?

@noneofyourbusinessgoogle

2 жыл бұрын

Correct, and there's no need for the S Corp status since the main benefit of the S Corp vs Single Member LLC is to reduce the amount of Self Employment tax

Wait, so is it pay yourself what you would pay someone to do the same job Or Pay yourself 1/3 of what the company makes?

@governmentprocurementsolutions

Жыл бұрын

A bit of both really because it's such a personal decision. The CEO of McDonalds (a huge corp) should be compensated at the millions because its a huge responsibility. The CEO of an Etsy shop could get away with 50k because its not nearly as much risk and it all depends on your gross earnings.

@SD-dm7lg

Жыл бұрын

@@governmentprocurementsolutions I'm grossing between 400-500k but just pay myself 50k per year. I don't want to flag the IRS, but if I were to pay someone to do my job, 50k is fairly "reasonable" The thing I'm concerned about is, I brought a partner onboard and now we're projected to increase gross by 50%. I want to leave my salary at 50k per year.

Ok good video ….but how pay my self …. I thought you will talk about steps.

personally ive heard 50% of profits in a one person S Corp

You said at the end what you should have said at the beginning. WAY TOO MUCH EMPHASIS ON WAY TOO MANY WORDS. Don't take that too critical. A more natural presentantion would feel more like a personal conversation. ;)