Avoid These 5 S Corp Mistakes

In this video I discuss the top 5 mistakes I see related to S Corporations. They are as follows:
1. Not using an Accountable Plan
2. Not paying reasonable compensation and paying payroll taxes for S Corp officers.
3. Not integrating S Corp Officer Health Insurance Premiums & HSA contributions in reasonable compensation.
4. Not completing Schedules L, M-1 and M-2.
5. Not keeping track of basis.
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#scorp #taxes #healthinsurance #hsa

[@thericciofilms]

Super helpful for accounting professionals like myself! Keep the great content coming

[@NaviMarajCPA]

Thanks for the feedback!

[@VictoryReverseMortgage]

Excellent work’ thank you sir

[@vladimirjean-baptiste1253]

very informative

[@mayatal6748]

hi thanks for the video can you only pay yourself at the end of the year?

[@carmensantiago4902]

Can someone living in a territory use these deductions ?

[@anitakirkpatrick3045]

My husband is Native American so he is Federally exempt and so I qualify for Medical which now both services are like Medi-cal but are not HSA qualified.😢 we still have hi-deductible and co-payments to pay. We have payroll and my husband has never taken any distributions.

[@user-hx6zd5kk5h]

do you do tax filing for S-corp.+ family tax return?

[@jermainesamples8154]

Is it possible to transition from a Single member LLC to and SCorp while paying yourself a W2 income but your employees 1099 as contractors?

[@lulz8119]

Does this apply to LLC’s being taxed as an S corp?

[@vangasandeepreddy]

Is it mandatory that Health Insurance and HSA integrated into Payroll? Can we take these separately and deduct them as expenses to get tax credit? What if a Payroll company doesn't provide these benefits to integrate to payroll? Thank you.

[@dmcrabby]

based on the type of business, could one fill out the M2 and not L or M-1?

[@user-py7wp6nw9h]

My s -corp pays the healthcare monthly premium, but I , myself, contribute to my HSA. No contribution from my company. I do try to pay myself in a 401k. If I make money (my s-corp that is) then I pay the maximum 401k. IF and only IF I have left overs , after expenses, I will take an additional distribution. But....there have been years , like 2023, where I made no money in the s corp (very little, actually). So let me suggest that you should make a video about the instance when an s-corp DOES NOT make enough money to pay a salary. THe problem is that ALL accountants with videos on the internet ASSUME that s-corp people make $100,000 each year. WRONG...why do you guys always assume that?

[@robb4214]

Have you made a video on officer benefit contributions?

[@petecandelario1700]

Can you make a video about an S-Corp partnered by 4 people (2 couples) that pays out to each of the couples own LLC or S-Corp? Then the individual S-Corp pays out the couple.

[@NaviMarajCPA]

I'll add it to the list Pete. Until then, you may have just made a mistake when asking your question, but usually you would form an LLC (and not have it taxed as an S Corporation) and the "members" for the LLC will be the individual S Corps. Hope that makes sense.

[@CryptoQueen8888]

What if i have millions left over from my S Corp after all business expenses?

[@CDGMR1]

How you reimburse yourself if you not making $$$$?

[@manjotsandhu3312]

Thank you for the great information. Can you recommend any good tax filling Software or website - me and my husband receive w2 which is easy to file but I made an s corp last year to do a side hussle. (Which is not in profit at this time). Or would you recommend contacting a CPA for filling taxes. Thank you

[@LuisCARB]

@NAVI, Hello. Can you help with contractors' business? I am thinking of booking an appointment?

[@NaviMarajCPA]

Hey there! I’m not currently taking on new clients but thanks for the consideration.

[@gwilson61]

Do you have a video concerning adding new shareholders - do you know if the IRS needs notified? If so what form do you use to notify IRS about admitting new shareholder?

[@urtaxwiz]

If I reduce my FICA contributions using an S Corp do I not also lower my potential SSA pension income later in life?

[@CrabbyE8]

Yes. But that’s not necessarily a bad thing. That’s a whole other conversation, but let’s just say you could do better investing that money yourself

[@marouanemazouzi7390]

Do i need to pay myself if my profit was like 30k ? And if not what will be the consequences thank you

[@leaftax]

At 30k, it wouldn’t be helpful to set yourself for payroll. The fees would be too much for your earnings.

[@marciabaez6189]

Profits created basic?

[@NaviMarajCPA]

Hi Marcia - please rephrase your question. I'm not sure what you're asking here.

[@hoyeay]

But if you provided a personal guarantee on that EIDL, wouldn’t that ALSO increase your basis?

[@CryptoQueen8888]

EIDL,PPP, as well as 3rd party loans are not classified as owners contributions.

[@thericciofilms]

Can you talk a little more about integrating an S-Corp shareholder’s health insurance into the payroll? I had thought this would be a distribution that would be deductible on their 1040?

[@NaviMarajCPA]

I think I cover it here: Health Insurance Premium Deductions & Tax Strategy for Entrepreneurs kzbin.info/www/bejne/fXiZdJunl7WebZI

[@thericciofilms]

@@NaviMarajCPA thanks! Does your course happen to include implementation of an accountable plan for S-Corps?

[@marketbuy]

@@thericciofilmsI’ve asked Navi over the past years to do an Accountable Plan video. We are still waiting and waiting…

[@mattholbrook8348]

If the owners are the only ones running the company and it's their first year and didn't distribute any money to themselves then do you still have to show a reasonable compensation?

[@programmerdave9425]

No, reasonable compensation must come before distributions, but if you don't take any distributions the reasonable compensation is not required it's just required before a distribution.

[@lotsoflove1897]

Can an individually owned S corporation be the top umbrella of several LLCs under it?

[@leaftax]

If you’re referring to set an S corp as a holding company for subsidiaries then yes

[@CryptoQueen8888]

​@@leaftax So my S Corp can also be a holding company for my LLCs.

[@user-td2dk1om1h]

If S corporation doesn't make any profit first year, do I have to pay myself a reasonable sellery?

[@NaviMarajCPA]

No, you do not.

[@user-td2dk1om1h]

@@NaviMarajCPA Thank you for answering.

[@user-td2dk1om1h]

@Navi Maraj, CPA I like your videos. I am originally from Ukraine, so English is my second language. But I understand everything that you say.

[@masalamix4647]

My S-Corp retail business is running loss for many years. Should I still need to do my payroll or can I just take a minimum amount for my expenses? If I can take a minimum amount means how long can I take and how long I am permitted to run a business without running payroll for me( I am a single owner and employee of the business). Please advice Sir.

[@jemimacoop2726]

I am so sick over this. I was a LLC partnership for 7 years, (very very small part time business). I filed the forms to be a single member s Corp and shouldn't have. I didn't know what I was doing . I only have 13k in net income, 28 gross. How can I give myself a salary with 13k in net income and not know what I will end up with. It's a crazy setup. I also have a full.time.jon making 100k last year. Any advice

[@CheddarCheeseBandit]

You can get rid of the S corp election by filing a form, however, there is a time period that you will have to sit thru before filing to be an S corp again.

[@CheddarCheeseBandit]

Also, I recommend to never pay someone to fill out forms or filings for you that you can do yourself. It forces you to learn a lot.

[@gwilson61]

Setup a new corp and let the s corp die.