- March 1, 2015
- Posted by: RCR Admin Team
- Category: Blog
By Paul S. Hamann & Jack Salewski, CPA, CGMA
Maybe instead of a ‘Safe Harbor,’ we should look for ‘Any Port in a Storm’. The IRS and Court Guidelines for determining Reasonable Compensation for an S Corp are anything but smooth sailing. We are often asked if there are any guarantees that the IRS will accept a Reasonable Compensation figure. The short answer is NO. Why? Because calculating a Reasonable Compensation figure is not included in any of the thousands of pages of IRS Code or Regulations. Therefore we are left to look at how the Tax Courts interpret Reasonable Compensation in S Corp cases.