How much do you pay yourself

I want $15K a month and I want cake

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Me too !!

I’m an LLC taxed as an S-Corp. I pay myself a salary as a W-2 employee then any profits at end of year are passed through (or kept in the business as retained earnings) and taxes are paid at personal income tax levels, no employment tax.

Plus ∞. We finally incorporated this year. Should save us at least 4 or 5k in taxes, and that’s including the added costs of having a corp (accounting, payroll, etc.)

We (my wife and I) each take a payroll check (direct deposit) each month on the 25th. We tell our payroll service how much we want our net deposit to be for the month, and they figure out all of our tax liability from there.

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i find it funny when the customer tries to write the check for 300.00 when the total is 321.00 with tax. so frustrating

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That is exactly how I do it too.

As to how much you should get paid and receive as dividends here is a rough outline that I use for the three types of reimbursement I expect from my business.

  1. Field tech (hands on labor on the job site including travel) should get at least 30% of the billable amount for the job. I value my labor at 35%. I say “at least” because the owner/field tech does better work than the average employee, doesn’t incur supervisor/trainer expense and is HIGHLY FOCUSED on up-sells, referrals and getting repeats.
  2. Business manager (BM) needs to get reimbursed for labor expended on all the non-billable tasks/hours such as: AR, AP, payroll, hiring, training, supervising, ordering supplies and equipment, maintaining equipment and vehicle, marketing, bidding, scheduling, submitting reports and more. BM labor reimbursement could be $X per hour or X percentage of the monthly or annual gross. I kind of go with 5% but am curious how others assign value to the BM labor.
  3. The owner/shareholders should expect to get at least 5-10% dividends (aka retained earnings in an S-Corp).

I track these percentages and hit these targets because I want to be aware of the opportunity costs of providing my labor to another activity and because of the ROI I expect for my investment of capital in the company.

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Congratulations!

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In Florida residential jobs don’t get charged tax, only commercial and office/storefront.

very good, yes, exactly how it should be done

the reason a self employed person makes more is because of what you said

doing the work - operations and operations manager
managing the business
admin
marketing
oh and you own the business profit %

I had all those figured out to the scaled percentages, quite eye opening
especially when the % was converted to $ to see how many hours it would buy an employee at

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