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.
🔗Useful Links:
🌐 Website: navimarajcpa.com/
📋 Enroll In My Course - Small Business Taxes: From Knowing Nothing to Savings Thousands: navimarajcpa.c...
📁 Setup your LLC or Corporation for FREE:
FileYourBusiness.com: www.fileyourbu...
Inc Authority: bit.ly/incautho...
IncFile: bit.ly/incfilec...
ZenBusiness: bit.ly/zenbusin...
If you learned something from this video, please like and subscribe and follow me on my various social media handles below. If you would like to contact me with a specific question, please visit my website or leave me a comment.
Website: www.navimarajc...
Email: [e-mail]
Instagram: / navimarajcpa
LinkedIn: / navimarajcpa
Twitter: / navimarajcpa
Facebook: / navi-maraj-cpa-pllc-10...
🎬 My Video & Audio Gear List 🎬
Sony ZV-1: amzn.to/3i7SYcm
SanDisk 128GB Extreme PRO SDXC: amzn.to/3c6fvm6
SanDisk 256GB Extreme PRO SDXC: amzn.to/3wORFTs
Elgato Cam Link 4k: amzn.to/3p8EKJq
Amazon Basics Flexible and Durable Micro HDMI to HDMI Cable: amzn.to/3yP4dfF
Anker 4-Port USB 3.0 Hub: amzn.to/3yTjKev
Rode VideoMicro Compact On-Camera Microphone with Rycote Lyre Shock Mount: amzn.to/2Tn0iX0
Gonine DK-X1 DC Coupler AC-LS5 AC Power Adapter Kit Replacement for NP-BX1 Dummy Battery: amzn.to/3vEbZHf
SMALLRIG Cool Ballhead Arm Super Clamp: amzn.to/2R99jCt
SMALLRIG Camera Cage for Sony ZV1 Camera: amzn.to/3uASs9m
Camtasia screen capture and video editing software: www.techsmith....
This video was created for informational purposes and it is not to be construed as legal and tax advice specific to your unique situation. Some of the links above are affiliate links which means that if you purchase a product or service with the provided link, I may receive a commission with no additional cost to you.
© Navi Maraj CPA PLLC. All rights reserved.
#scorp #taxes #healthinsurance #hsa

[@theafilms233]

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

[@NaviMarajCPA]

Thanks for the feedback!

[@Sandracabine]

Your content is spot on. Thank you!

[@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.

[@mayatal6748]

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

[@timgean8954]

Great information. Question - I have an S corporation - electrical contracting - I am on medicare with a supplement, the premium for the supplement is $173.00 a month, can I reimburse myself that premium from the S corp under health insurance?? Thanks

[@loyaltywealth4u]

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

[@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.

[@lulz8119]

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

[@sahilpnupur]

Hi Navin....super helpful

[@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?

[@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

[@VictoryReverseMortgage]

Excellent work’ thank you sir

[@cadillacslick]

A Solo ROTH 401k plan would also reduce your payroll taxes like an HSA and health insurance......

[@dmcrabby]

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

[@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.

[@carmensantiago4902]

Can someone living in a territory use these deductions ?

[@Goddess8888-Winner]

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

[@hoyeay]

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

[@Goddess8888-Winner]

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

[@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.

[@vladimirjean-baptiste1253]

very informative

[@Америкабезмакияжа]

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

[@NaviMarajCPA]

No, you do not.

[@Америкабезмакияжа]

@@NaviMarajCPA Thank you for answering.

[@Америкабезмакияжа]

@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.

[@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.

[@LTDOGG]

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

[@Goddess8888-Winner]

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

[@BorselinoThadchack]

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?

[@marciabaez6189]

Profits created basic?

[@NaviMarajCPA]

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

[@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.

[@CDGMR1]

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

[@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?

[@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

[@robb4214]

Have you made a video on officer benefit contributions?

[@theafilms233]

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

[@theafilms233]

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

[@marketbuy]

@@theafilms233I’ve asked Navi over the past years to do an Accountable Plan video. We are still waiting and waiting…

[@basemandog]

They will use the taxpayer money to go after taxpayers……. Of course

[@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.