Posted by Roger Garay E.A. on June 27, 2004 at 21:53:45:
I concur with CPA Haslach, but note that “provide no services” also means that you not be an officer of the corporation, since by definition an officer is an employee (IRC Sec 3121(d)–also see newsletter on same subject at my web site www.olbts.com).
passive 2% S-corp shareholder? - Posted by Bob
Posted by Bob on May 19, 2004 at 18:36:24:
Is a passive 2% S-corporation shareholder (one who doesn’t participate in managing the business) still required to take salary?
Re: passive 2% S-corp shareholder? - Posted by JOHN K HASLACH, CPA MST
Posted by JOHN K HASLACH, CPA MST on May 20, 2004 at 08:14:22:
If all you are doing is making an investment in the S Corp and provide no services to the S Corp, the IRS would have a hard time making an argument that you should be paid a salary. However, they could always try.