Unreasonably Low Salaries in S Corporations: A Prescription for Additional Payroll Taxes, Interest and Penalties

Date
2011-11-18
Authors
Harl, Neil
Journal Title
Journal ISSN
Volume Title
Publisher
Altmetrics
Authors
Research Projects
Organizational Units
Journal Issue
Series
Abstract

It has been clear for more than two decades – unreasonably low salaries and wages in an S corporation will, almost certainly, lead to audits, additional FICA and FUTA tax assessments, interest and penalties.1 Despite the overwhelming authority favoring so-called “deemed” wages,2 and clear warnings against the practice,3 the cases continue to be litigated. A TIGTA Report estimates that shareholders underreported $23.6 billion of compensation in 2003 and 2004.

Description
Keywords
Citation
DOI
Source
Collections