S Corp owner 's draw
US QuickBooks Premier : 2009: Accountant
Can the sole owner of an S- Corp take a draw and no salary?
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Gloria269
Questions asked: 7
Questions answered: 2
Points earned: 2
Questions answered: 2
Points earned: 2
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01/27/12 10:32am PST
Viewed by asker 01/30/12 11:33am PST
Viewed by asker 01/30/12 11:33am PST
5 Replies
01/27/12 10:34am PST
The IRS requires the shareholders in an S-corp to take a reasonable salary.
If this answers your question, please click SOLVED.
01/27/12 10:40am PST
Thank you. Is there any rule that disallows an owner from taking draws from the company?
01/27/12 10:45am PST
The solution
The term used is "distribution." Drawings is more a sole proprietor thing. And no it is not disallowed, but there are specific rules and tax consequences. The advice of a CPA should be sought in order to avoid costly mistakes. Or you could go to the IRS webste and look for documents on the matter.
