S corp owners, take heed — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
The IRS continues to turn up the heat on S corporations. For starters, it has completed 1,200 audits of S corp returns for 2003 as part of a program to update audit-selection data. Furthermore, almost 4,000 more S corp returns for 2004 are scheduled for intensive line-by-line examination. In particular, the IRS says it is looking for firms that have paid little or no salary to owner/employees as a way to evade federal employment taxes.