How To Pay Yourself From Your S Corporation
In this audio snippet, you'll hear about:
- When paying yourself from your S Corp, be sure to write checks directly to yourself – not credit cards, not any personal expenses
Audio Transcript
Yosef:
Absolutely. There is a very, very critical issue that we just didn't
have time to address yet. People ask me often, "How do I pay myself
from my S–Corporation? My S–Corporation has done well. I want to take
distributions. What do I do?"
I
tell people it is very important when you take a distribution from an
S–Corp, the check must be written directly to a shareholder. The check
should not be written to pay a shareholder's credit card. The check
should not be written to pay any other personal expense.
Travis:
That is interesting. Why is that?
Yosef:
Why is that? Because otherwise you are going to have an issue of co–mingling of funds.
Travis:
And that pierces the corporate veil?
Yosef:
That could potentially pierce the corporate veil.
Travis:
OK.
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