ChristinaS
New Member

Business & farm

Distributions don't impact your taxes. You pay youself a reasonable salary (W2), and the balance is passed through as shareholder income. Both are ordinary income, but the former has payroll tax. You wear two hats with an Scorp- employee and owner. As employee, you need to be on payroll.
You are not permitted to not pay yourself a reasonable salary. This is another topic altogether. Please google "reasonable compensation Scorp"- you will find a lot of information.