How Much Should I Pay Myself? [E144] - Business By The Numbers

About this episode

Thanks to our partners, NAPA TRACS, and PromotiveA critical topic for business owners: how much you should pay yourself as an S-corporation owner. This episode clears up common misconceptions around payroll, distributions, and tax savings strategies. Whether you're a small business owner or a shop manager, understanding these financial nuances is crucial for maintaining profitability and compliance.Key Points:- Clarification of the S-corporation owner's dual roles as an employee and business owner, and their impact on financial strategy.- Differences between payroll and distributions and how they affect tax liabilities.- Why overpaying yourself in wages does not save on taxes and the financial consequences of excessive payroll tax burdens.- The IRS's guidelines on "fair and reasonable salary" for S-corp owners and how to meet this requirement effectively.- Social Security contributions: strategies for maximizing benefits while minimizing unnecessary tax burdens.Thanks to our partner, NAPA TRACS Did you know that NAPA TRACS has onsite training plus six days a week support?It all starts when a local representative meets with you to learn about your business and how you run it.  After all, it's your shop, so it's your choice.Let us prove to you that Tracs is the single best shop management system in the business.  Find NAPA TRACS on the Web at NAPATRACS.comThanks to our partner, PromotiveIt’s time to hire a superstar for your business; what a grind you have in front of you. Introducing Promotive, a full-service staffing solution for your shop. Promotive has over 40 years of recruiting and automotive experience. If you need qualified technicians and service advisors and want to offload the heavy lifting, visit www.gopromotive.com.Paar Melis and Associates – Accountants Specializing in Automotive RepairVisit us Online: www.paarmelis.comEmail Hunt: podcast@paarmelis.comDownload a Copy of My Books Here:Wrenches to Write-OffsYour Perfect Shop The Aftermarket Radio Network: https://aftermarketradionetwork.com/Remarkable Results Radio Podcast with Carm Capriotto: Advancing the Aftermarket by Facilitating Wisdom Through Story Telling and Open Discussion. https://remarkableresults.biz/Diagnosing the Aftermarket A to Z with Matt Fanslow: From Diagnostics to Metallica and Mental Health, Matt Fanslow is Lifting the Hood on Life. https://mattfanslow.captivate.fm/Business by the Numbers with Hunt Demarest: Understand the Numbers of Your Business with CPA Hunt Demarest. https://huntdemarest.captivate.fm/The Auto Repair Marketing Podcast with Kim and Brian Walker: Marketing Experts Brian & Kim Walker Work with Shop Owners to Take it to the Next Level. https://autorepairmarketing.captivate.fm/The Weekly Blitz with Chris Cotton: Weekly Inspiration with Business Coach Chris Cotton from AutoFix - Auto Shop Coaching. https://chriscotton.captivate.fm/Speak Up! Effective Communication with Craig O'Neill: Develop Interpersonal and Professional Communication Skills when Speaking to Audiences of Any Size. https://craigoneill.captivate.fm/