Comment: Re:The Joys of employeehood.... (Score 1) 509
Just to clarify, it has nothing to do with if you're a "sole shareholder". If you're an employee-owner, you have to pay yourself fair compensation for the work you do, regardless of if there are other shareholders. If you attempt to funnel salary through shareholder profit distribution and don't maintain what the IRS considers a reasonable salary, you'll get nailed for it dodging SE tax. If you're a shareholder that is not an employee and does not do work for the company, you have nothing to worry about.
The typical advice on "fair salary" is to research a bunch of salary survey websites, print the information out and save it in a file, and then pick something about in the median. If the IRS comes asking, it's up to you to provide backing documentation that the salary you're paying is considered reasonable. If your profit distributions are still unreasonably high due to working twice as many clients as is standard and you don't pay yourself extra salary, that can also be viewed as SE tax avoidance.