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Back to Track 4: Business Planning

Course 4.3 · 55 minutes

Paying Yourself: Draws, Salary, Distributions, and Reasonable Compensation

Pay yourself the right way for your entity, set an S corporation salary that saves payroll tax without inviting an audit, and run payroll correctly.

Who it is for
Owners of LLCs, S corporations, and partnerships.
Runtime
55 minutes

Pre-order: this course is still in development. Your purchase includes its materials as they are published in your portal. No release date is confirmed. Buy 5 or more and every course is 30% off.

See the full trackSee the full curriculum

After payment is confirmed and your access is set up, the files listed below can be downloaded from your portal. Any unpublished materials will be added when ready, at no additional charge.

Files currently available

  • Reasonable Compensation Memo.
  • Salary vs Distribution Calculator Guide.
  • Salary vs Distribution Calculator.
  • Owner Pay Decision Tree.
  • Payroll Setup and Filing Calendar.
  • Owner Health Insurance W2 Checklist.
  • Slide deck.
  • Visual: Roadmap.
  • Visual: Owner Pay by Entity.
  • Visual: Se Tax vs Payroll Tax.
  • Visual: Reasonable Comp Factors.
  • Visual: Setting the Number.
  • Visual: Payroll Calendar.
  • Visual: Health Insurance W2.
  • Visual: Basis Bucket.
  • Visual: Worked Example.
  • Visual: Salary Decision Tree.
  • Visual: Tricks Timeline.
  • Visual: Traps.
  • Workbook.
  • The narrated lesson. 55 minutes, cued to the deck, with chapter markers by lesson. Added to your portal when published, at no extra cost. This purchase does not guarantee that the narrated lesson is available today.

What the course covers

  • 01How owners get paid under each entity: draws, guaranteed payments, wages, and dividends8 min
  • 02Self-employment tax versus payroll tax, and where the savings come from6 min
  • 03Reasonable compensation: the rule, the cases, and the factors the IRS uses9 min
  • 04Setting the number: market data and the annual memo6 min
  • 05Payroll mechanics: the quarterly forms, deposits, and the owner's health insurance on the W-27 min
  • 06Distributions and basis: why you cannot take out more than you have5 min
  • 07Worked example: a 150,000 dollar S corporation at a 70,000 dollar salary versus a 100,000 dollar salary, with the twenty percent deduction8 min
  • 08Tricks of the trade: December bonuses, paying the spouse, and keying retirement contributions to wages3 min
  • 09Mistakes and traps: zero salary, late deposits, and shareholder loans3 min

How it fits: Requires 4.1. Pairs with 5.3 and 4.6.

The standard every course holds

  • A narrated lesson of 45 to 60 minutes, produced as audio
  • A designed slide deck you download and keep
  • A computational workbook that runs the actual legal tests
  • A toolkit of checklists and protocols
  • A legal authority appendix carrying the two-pass vetting protocol

Written for a diligent reader with no legal education. Professionally narrated using a studio voice model of Brian T. Boyd. The course is recorded instruction, not a live consultation.

Where this course sits

Track 4: Business Planning

This course is one step in a track built around a single outcome. See the full build order and the other courses that get you there.

Back to this track

Educational material from the private client curriculum of Brian T. Boyd. This is legal education for a general audience, not legal advice, and no attorney-client relationship is created by purchasing, viewing, or using it. Tax outcomes depend on your facts and your state.