For high-earning performers and creators with an S corporation, or thinking of one

$24,000 salary, $186,000 taken out. The examiner will ask.

Stipend shows where the facts point for an S corporation’s reasonable salary: receipts split by source — the shareholder’s own work, other employees, capital and equipment — the hours worked, comparable pay and where it came from, and the IRS’s nine factors answered. The owner decides; Stipend makes the decision a dated record.

Open the demo See pricing

Opens in this browser with an invented creator’s company already in it. No account, no email address, nothing installed.

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The problem

Distributions carry no payroll tax. That is why the IRS watches.

The IRS says an S corporation must pay reasonable compensation to a shareholder-employee for their services before non-wage distributions may be made, and can reclassify distributions as wages. The key is where the receipts come from. For a performer whose income is almost all their own work, the facts usually point to a lot more salary than they would like.

Reasonable

compensation must be paid to a shareholder-employee before non-wage distributions.

IRS →

9 factors

training, duties, time, distribution history, pay to others, bonuses, comparable pay, agreements, formula.

Reclassified

distributions the IRS treats as wages, with the payroll tax that comes with them.

Will not record a decision the facts do not support.

Not a reminder. Record the decision refuses, with the reason named, while receipts, comparable pay or hours are missing, distributions were paid with no salary, the salary is outside the range with no written reason, health premiums are not on the W-2, or any of the nine factors is unanswered. There is no override.

How it works

The year, the factors, past decisions

Enter the year

Receipts by source, what you took out, hours of your own work and of managing others, and comparable full-time pay with its source.

Answer the nine factors

The IRS’s list, each in a line or two.

Record the decision

The range the facts point to, your salary on it, the payroll tax it carries, and W-2 box 1. Kept year by year.

What it will never do

It shows the range. You pick the salary.

Stipend never picks the salary. The owner decides, with their adviser, and Stipend records why.

No payroll run.It records the decision; your payroll pays it.

No salary chosen for you.The range is drawn from the facts; the choice is yours.

It is not an accountant.Not tax advice. Take the record to your adviser.

It never touches a payment.The licence is for software.

Pricing

Priced per company

The one line an examiner always questions.

Most creators

One company

$49/year

One S corporation, one shareholder.

Receipts by source
The range the facts point to
A dated decision record

Two companies

$79/year

Two S corporations or two shareholders.

Everything in One company
Past decisions year by year
Export for your adviser

Yearly licence. Your bank statement says Stipend Software. Refunded in full on request within 30 days. Your licence key is emailed to you within two working days of payment.

Checkout is our own bitcoin server, not a card processor — nobody we had to apply to and nobody who can close the account. The button takes you straight to it. Give your email address there — that is where your key is sent.

Questions

The ones we actually get asked

Why does the source of receipts matter?

Receipts from your own work point to wages. Receipts from other employees, or from capital and equipment, can properly be distributions.

Can the salary be more than I took out?

No. Reasonable compensation is never more than the shareholder actually received.

What about health insurance?

For a more-than-2% shareholder, premiums go in W-2 box 1. Stipend checks it.

Is this tax advice?

No. It is the record of how you decided.

What do I actually get when I pay?

The demo on this page is the whole program, running on invented records. Paying gets you a licence key — one line of text, emailed to the address you give at checkout within two working days. Paste it into the program and from then on it keeps your own records. Until then, nothing you type into it is kept.

The key is checked inside the page, on your own machine. It never calls us, so there is still no account and nothing about your business goes anywhere. If you ever stop paying, your records stay exactly where they are, read-only, and Export still hands you every one of them.