Reasonable Compensation, Real Tax Savings: S‑Corp Owner Pay Strategies That Survive IRS Scrutiny

Reasonable Compensation, Real Tax Savings: S‑Corp Owner Pay Strategies That Survive IRS Scrutiny

11 Aug, 2025
Owning an S‑Corp? Your paycheck is a tax lever. In this episode of Tax Smarts Unlocked, David Robson demystifies reasonable compensation so your owner pay strategies deliver real tax savings—and survive IRS scrutiny. Learn how to blend W‑2 wages and distributions, calculate a defendable salary using industry comparables, role/time analysis, and profitability, and document it all to withstand an audit. Through practical case studies, we reveal how compensation affects payroll taxes, 199A/Qualified Business Income, retirement plan funding, and state taxes. You’ll get a simple framework, a documentation checklist, and common red flags to avoid (no, you can’t pay yourself $1 and call it “reasonable”). Whether you dread April 15 or just want proactive planning, this episode shows why partnering with a professional tax planner pays—literally.