Salary from corporation
Hey guys, I'm a long term lurker and finally decided to post for some help of my own.
I was wondering what would be the best way to pay myself in this unique situation. I will be talking to my accountant and lawyer next week but want to get a grasp on things before hand.
My business partner and I will be opening up a new business come September where his holding company owns 50% of the shares and my holding company own the other 50% of shares in the operating company. All profits will be split evenly however I will be getting paid an extra $80,000 a year (salary not dividends) to work full time and handle all day-to-day operations. If we don't make enough money in the 1st year then I will be owed my salary and not paid the full amount (only enough to live off).
I'm concerned about the tax implications of this arrangements because if we don't make money from Sept-December I will forfeit $27,000 of salary for 2012 and then will have to pay tax on $107,000 worth of salary in 2013. Is there any way around this?? Things can get even more messy if we don't make money for a year or two and then once I finally pay myself I will be paying tax on a salary of $160,000+ for that year
Thank You
I was wondering what would be the best way to pay myself in this unique situation. I will be talking to my accountant and lawyer next week but want to get a grasp on things before hand.
My business partner and I will be opening up a new business come September where his holding company owns 50% of the shares and my holding company own the other 50% of shares in the operating company. All profits will be split evenly however I will be getting paid an extra $80,000 a year (salary not dividends) to work full time and handle all day-to-day operations. If we don't make enough money in the 1st year then I will be owed my salary and not paid the full amount (only enough to live off).
I'm concerned about the tax implications of this arrangements because if we don't make money from Sept-December I will forfeit $27,000 of salary for 2012 and then will have to pay tax on $107,000 worth of salary in 2013. Is there any way around this?? Things can get even more messy if we don't make money for a year or two and then once I finally pay myself I will be paying tax on a salary of $160,000+ for that year
Thank You