Blog

A particular kind of tax mistake doesn’t feel like a mistake in the moment. You pay for a legitimate business expense on your personal card because it is convenient—a software renewal, office supplies, a client-related expense, or business mileage that never gets recorded. One transaction may not feel important. Repeated over a year, personally paid

Health insurance is one of the most predictable expenses a business owner has. You know roughly what it costs every month, you pay it without much thought, and it is easy to assume that because you paid the premium, the tax deduction will take care of itself. For more-than-2% S corporation shareholders, that assumption can

Most retirement-planning mistakes do not look like mistakes when they happen. A plan never gets set up because something else feels more urgent. A contribution is skipped because cash flow is tight. A strategy chosen years ago keeps running even though the business, the owner’s income, and the employee count have all changed. That is

There’s a retirement and tax strategy sitting inside plenty of businesses that never gets used, not because it’s complicated, but because nobody thinks to look at it: the spouse who’s already doing real work for the business, unpaid. It shows up in different forms. The spouse who handles the books on weekends. The one who

Most business owners do not need the retirement plan that is “best” in general. They need the plan that best fits how their business is structured today. Yet many owners choose a plan once — often when the business is smaller  and never revisit it as income rises, employees are added, cash flow changes, or

The IRS Has No 60/40 Rule for S Corp Salaries “The IRS expects you to take 60% as salary and 40% as distributions.” If you own an S Corp, there’s a good chance you’ve heard some version of that advice. Maybe it was 60/40. Maybe it was 50/50. Maybe someone told you to pay yourself

Two owners. Same profit: $200,000. Same industry. Same role. Wildly different salaries  and only one of them holds up under scrutiny. Owner A pays himself $28,000 in salary and takes the rest as distributions. There’s no wage benchmarking behind it, no written analysis, and he hasn’t revisited the number since he incorporated. If asked, he

“I file my 1120-S every year, so I’m covered.” It sounds reasonable. Your accountant prepares the return. You sign it. The IRS accepts it. Another tax year is officially in the books. So you’re compliant, right? Not necessarily. Form 1120-S is an annual tax return. It is not a year-round operating system. Running an S

Imagine two S Corp owners. Same industry. Same $180,000 of business profit. Both pay themselves a salary and take additional money from the company as distributions. On the surface, they look similar. But if someone asked each owner one very simple question— “How did you determine your salary?” —only one has a good answer. And

Somewhere along the way, “once you hit $50,000 in profit, elect S Corp” became gospel. Business owners repeat it to each other. Social media repeats it. And, unfortunately, some advisors repeat it too. It sounds helpful because it gives you a clean number to watch for. There’s just one problem: It isn’t a rule. There