How to cut the tax bill on your self-employment salary

August 31, 2009: 9:08 AM ET

If you own your own company, you can skip a salary in favor of distributions, but the IRS still wants its share of the money you take home.

Erin, Kailua-Kona

Do shareholders have to take a salary in an S corp? Can they just take distributions? How about an LLC?


  • When customers abandon their property

    A dry cleaner considers turning customers' absentmindedness into a tidy tax break.

    Taylor, Jackson, Miss.

    I own a dry cleaning business and was wondering what to do with all the forgotten or left-behind clothes. They date back a few months or as far back as a year. I read that by donating them I could get a tax write-off.

    Aug 20, 2009 10:22 AM ET
    Posted in:
  • All work and no pay

    Handling the client that wants the goods but doesn't want to cough up a check.

    Susan Lewis, Lancaster, Calif.

    Can we legally hold a client's paperwork if they haven't paid their bill? We do their bookkeeping and they haven't paid in months. We haven't done any additional work for about two months, and now they are asking for their paperwork back. If we send it to them, we will never get paid.

    Aug 11, 2009 6:14 PM ET
  • Tax tangle: Medical deductions for LLC owners

    Business owners can write off many of their health care costs, but complying with IRS rules requires some planning.

    Jonathan Cottor, Scottsdale, Ariz.

    I have an LLC, and I'm seeking some advice about my family's medical expenses. One accountant told me they can be run through the LLC as a business expense, and I've been paying the insurance premiums and any eligible co-pays and FSA-qualifying-type out-of-pocket costs through the business as an MORE

    Jul 29, 2009 12:37 PM ET
  • Selling homemade goodies - legally

    Selling sweet treats can be a fast way to make extra cash, but the road to doing it legally is paved with bureaucracy.

    Ana, Dartmouth, Mass.
    I'm thinking about making some truffles (chocolate and peanut butter), putting a flyer together, passing it to friends at work and selling to them. I'm making them at home.  Do I need to get a business license or a food license?

    Jul 23, 2009 3:01 PM ET
    Posted in:
  • Breaking up the family business

    If the problem of too many owners is killing the business, it's time to restructure.

    Kelli, Bishop, Calif.
    How hard is it to split a family business? A mother and three siblings each own 20% of the business but the siblings don't get along at all.

    Jun 4, 2009 4:45 PM ET
  • How to get your video game into retail stores

    Have a hot idea for an educational software product? Here's how successful entrepreneurs have cracked the market.

    Ernest L. Leisner, Buffalo
    I have created a word game that I would like to transform into an educational video game. I believe it can go a long way to help improve the dismal illiteracy rate in our schools. I have many aspects of a proposal in place and I'd like to find a government MORE

    May 28, 2009 2:04 PM ET
  • How to keep laid-off workers honest

    Experts reveal the best ways to keep company information in the building when the employees exit.

    Tom Goll, Owner, U.S. Diversified Tech, Nashua, N.H.
    We always hear about what employees should do to prepare for layoffs. But what should employers do to ensure that company data, contacts and customer lists don't walk out the door with terminated employees?

    May 26, 2009 10:42 AM ET
  • Trademarks 101: How to protect your good name

    Registering your company's name as a trademark isn't legally required, but it can pay off down the road.

    Nick, Seattle
    I am starting a clothing company and need to copyright the brand name. What is the best way to do this on a tight budget?

    May 13, 2009 12:29 PM ET
  • Firing yourself: Unemployment benefits for business owners

    If you're out of business and out of work, you may have to fight for the benefits you're due.

    My husband and I own a small business in South Carolina. Since the bottom fell out of the market, our business has come to a screeching halt and we're filing for bankruptcy. My husband is the primary officer of the company, but we'd also listed him as an employee and signed MORE

    Apr 23, 2009 6:35 PM ET
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