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Showing 17–18 of 18 results
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Don’t “wage” war with the IRS – Review S corporation compensation to help ensure it will pass muster
September / October 2008
Newsletter: Tax Impact
Price: $225.00, Subscriber Price: $157.50
Word count: 601
Abstract: The payment of reasonable compensation to S corporation shareholders is high on the IRS’s list of audit concerns. That’s because S corporations that make distributions of profits in lieu of salaries to employee shareholders enjoy significant savings on employment taxes. In recent years, auditors have been scrutinizing S corporation salaries and recharacterizing distributions of profits as wages when they feel that shareholder compensation is unreasonably low. The result: Affected businesses receive an unpleasant surprise in the form of a bill for unpaid employment taxes, plus penalties and interest. This article offers advice on how to determine reasonable compensation.
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How normalized earnings paint a true-to-life financial picture
Summer 2008
Newsletter: Expert / Valuation & Litigation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 601
Abstract: To reach an accurate business value, a company needs to work with a professional valuator to determine its normalized earnings. This article explains why normalized earnings provide a more complete view of a company’s financial position and facilitate easier comparison with other companies. Among the types of adjustments discussed are revenue, depreciation, compensation, related-party transactions and inventory.