Impact on Reasonable Compensation for S Corp Shareholder: Employees (Completed)

What Is the Optimal Balance of Pay vs. Dividends for S Corp Employee-Shareholders?

Join experienced tax practitioner and instructor Greg White, CPA, as he presents a broad overview of the reasonable compensation rules, including up-to-the-minute changes. This two-hour CPE webinar will include coverage of how the Tax Cuts and Jobs Act (TCJA) affects decision-making in grey areas, and how to determine the optimum amount of compensation (within a reasonable range) for S corporation shareholder-employees. The new tax law presents opportunities and pitfalls that you clients need to be aware of.

Greg will compare S corporations vs. LLCs under the TCJA to help you optimize entity choices and tax planning. You will learn when do S corporations provide greater qualifying business income deductions (20% passthrough deduction) – and when they provide less.

Who Should Attend
CPAs, EAs, and other tax professionals and tax staff who have responsibility for filing Forms 1120S.

Topics Covered

• Reasonable compensation case law
• When to pay less compensation to increase the 20% passthrough deduction
• When to pay a shareholder employee more compensation to increase the 20% passthrough deduction
• What amount of wages optimizes the 20% passthrough deduction
• When are S corporations better choices for reducing overall taxes — and when aren't they
• What is the "cost" of paying less in payroll taxes

Learning Objectives

• Recognize how determine "reasonable compensation" for S corporation shareholders
• Identify and apply the reasonable compensation rules in specific settings
• Describe how to maximize S corporation shareholders' 20% passthrough deduction
• Identify and apply a formula to determine the optimum amount of wages to maximize the 20% passthrough deduction
• Recognize how to adjust reasonable compensation (within a reasonable range) to maximize the 20% passthrough deduction

Level
Intermediate

Instructional Method
Group: Internet-based

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
Participants should have experience in federal income taxation issues including preparation of Forms 1120S.

Advance Preparation
None