Part 6/10:
To avoid penalties or audits, the presenter advises that your salary must be justifiable and within reasonable limits based on industry standards and your role.
Key Factors in Defining Reasonable Compensation
To ensure compliance, the IRS considers several elements, including:
Your training and experience
Responsibilities and effort within the business
Business dividend history
Payments to non-shareholder employees
Timing and structure of bonuses
The presenter mentions a dedicated video on this topic for viewers interested in the nuances of setting appropriate salaries.