Reasonable Compensation Reports
Reports in Minutes
Generate a full reasonable compensation report in minutes using our proprietary tool that includes step-by-step guidance to calculate an accurate and defensible figure.
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Also known as the Many Hats Approach, the Cost Approach breaks down the time spent by the business owner into various duties performed and quantifies the amount of time devoted to the different duties. The Cost Approach generally works best for small businesses where the business owner provides multiple services for the business.
Also known as the Industry Comparison Approach, the Market Approach compares the business owner’s compensation to compensation with businesses of the same size and industry. The Market Approach generally works best for medium and large businesses where the business owner provides only one duty: management of the business.
Also known as the Independent Investors Test, the Income Approach seeks to determine whether a hypothetical investor would be satisfied with their return on investment when looking at the financial performance of the business in conjunction with the compensation level of the owner. Generally used in litigation to support or discredit a primary approach such as the Cost or Market.
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Choose from 3 IRS approved approaches
Entity Selection Planner
Quickly determine what business entity is most beneficial to your client and generate a report that details savings over a ten year period.
Warp Speed Wages
Look up any wage data point in our database in seconds.
Pro Advisor Worksheet
Detail your notes regarding a client’s reasonable compensation figure along with any adjustments needed and append this worksheet to the official report.
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Instant access to wage data
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IRS job aids
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“Whereas you may have to spend 4 hours, or 6 hours, or in some cases 2-3 days to determine reasonable compensation for a given party, now this can be done in a matter of minutes…I really believe the data in RCReports and the analysis they’ve done will go a long way towards avoiding issues with the IRS related to reasonable compensation.”
— Michael Gregory Former IRS Agent, now in private practice