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Do all members of a Multi-member LLC have to be paid a salary when taking the S-Corp Tax Status?


@Mike9241 wrote:

so having just one employee/member effectively saves all members from having to pay tax on the business income distribution that shows up on their K1 and personal return? 

 

NO. NO. NO.  they all have to pay income tax on their allocated portion of the business income as shown on the k-1. it's just that this income is not subject to self-employment tax.  consult a pro.


I believe @pzajic meant to write "...pay self-employment tax..." in that sentence.

 

@pzajic must be aware that income reported on their K-1s is generally taxable to the other members.

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