Reasonable Salary
“I want to take a massive year-end cash bonus from my S-Corp, does this lump sum count toward my reasonable compensation threshold?”
A year-end cash bonus from an S-Corp can raise reasonable compensation questions, but the answer often depends on how the payment is characterized, the shareholder’s actual services, and whether the total pay package reflects what similar businesses would pay for comparable work. The timing of the bonus, the company’s profitability, and the pattern of regular wages versus distributions can also matter. In many cases, the IRS looks at the full facts and circumstances rather than treating one lump sum as automatically satisfying the compensation standard. Working through the specifics with a CPA is the cleanest way to land on the right move.
In your 90-minute session, the KGOB advisor handling it will:
- Read your exact situation and tell you, in plain English, what’s actually going on.
- Lay out your options and the trade-offs — no jargon, no judgment.
- Give you a clear next step you can act on, whether that’s with us or on your own.
This page is a prompt to start a conversation, not tax or legal advice, and states no tax-law specifics as fact. A consult session does not by itself create an ongoing engagement. We do not promise specific outcomes or savings. Kohari Gonzalez Oneyear & Brown PLLC — Charlotte, NC.
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