Hey guys, just relaying some information that came across the wires regarding a report TIGTA performed on S Corporation Returns as it relates to reasonable comp, or should I say, lack thereof....
Here's the report: https://www.treasury.gov/tigta/auditrep ... 0042fr.pdf
Here are the highlights:
TIGTA Report Number 2021-30-042 addresses broad compensation underreporting issues within S corps. There's a lot of interesting data to mull over in that report, but here's one of the biggest punchlines: 49.5% of S corps report zero officer's compensation. Half of S-corps. No reasonable comp. None.
A preparer could keep themselves pretty busy by marketing to S Corporations that are out of compliance; hint, hint... You could gain an accounting, payroll, and tax prep client all in one!