Episode 40. S-Corporation Distributions vs. W-2 Salary

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If your accountant is telling you to max out your W-2 salary and avoid distributions, they're literally costing you thousands in unnecessary taxes.

In this podcast I’m breaking down why taking high S Corporation distributions compared to your W-2 salary is the smartest tax planning move for business owners in 2025. Most CPAs and tax preparers get this backwards, telling you to increase W-2 wages while avoiding S Corporations distributions entirely.

The REAL reason S Corporations exist (hint: it's to REDUCE self-employment tax and payroll taxes, not increase your W-2 salary). I break down S Corp taxation, pass-through entity taxation, how to avoid double taxation, and why maximizing W-2 wages destroys your tax savings.

I share a real client example where his accountant told him to take everything as W-2 salary. This terrible advice would've cost him the Pass-Through Entity Tax (PTET) deduction, state tax deductions, and tens of thousands in unnecessary taxes, Social Security tax, and Medicare tax.

We also cover the additional tax strategies you can use when you structure your S-Corporation distributions properly. You can open doors to tax deductions your high W-2 salary is currently blocking. Plus, I'll tell you exactly what to do before year-end so you can start saving money on taxes immediately. No more overpaying because someone gave you backwards advice about W-2 vs distributions.

I've put together this FREE resource for you:

7 Write-Offs Every S-Corporation Business Owner MUST Know
🆓 Download FREE PDF here: https://7taxwriteoffs.com/?el=podcast&htrafficsource=buzzsprout

Ready to start saving money on your taxes?
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*Disclaimer This material & presentation content is for informational and educational purposes only. This material and presentation content is designed to provide general information regarding the subject matter covered. It is not intended to serve as legal, tax, or other financial advice related to individual situations. Because each individual’s legal, tax, and financial situation is different, specific advice should be tailored to the particular circumstances. For this ...