Forgot to take distributions.... Hi, I’m a 25% shareholder in a family business ( new to S corp) and we have $200,000 in profit for the year. The 75% shareholder put off distributions this year and is planning on making up for it next year. We each have around $50,000 in as salary. Neither of us will likely be taking any distributions this year though I think we should. If I understand right we will still be taxed on the profits? Also I was under the impression there were less taxes if profits were paid out as distributions vs wages? If we don’t take distributions this year we’ll we be able to “make up” for it next year without affect our tax bracket?
Thanks |