S-Corporation Salaries

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Must an S-Corporation pay its owner a salary when it is losing money, and would be losing money even if it paid no salary to its owners?

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  • bargain7622nd April, 2005

    An S-Corp does not have owners.

    An S-Corp has stockholders and employees and is treated as a corporation, with all the rights, obligations and limitations that may entail.

    The major difference an S-Corp has compared to a C-Corp, is that the earnings (or losses) flow directly to the shareholders. There is no corporate tax.

    To answer your question... NO.

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