Payroll is complicated! Setting up payroll is even more complicated.
This video walks you through the Payroll Set Up in your Collective Dashboard.
It is a MUST WATCH before your first attempt.
How much should I pay myself? While you are setting up your payroll mechanics, there will be a section related to your reasonable compensation. An S Corp owner has to receive what the IRS deems a “reasonable salary” — basically, a paycheck comparable to what other employers would pay for similar services. If there’s additional profit in the business, you can take those as distributions, which come with a lower tax bill. Please Review the following articles for more direct help to establish your reasonable compensation.
Disclaimer: The information contained in this document is provided for informational purposes only and should not be construed as financial or tax advice. It is not intended to be a substitute for obtaining accounting or other financial advice from an appropriate financial adviser or for the purpose of avoiding U.S. Federal, state or local tax payments and penalties.