MARK KOHLERMain Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, LLC · Owner at Main Street Professionals, LLC

My Aggressive S-Corp Salary Loophole 🤫

1 Jul 2026 · 1 min

Watch on YouTube

1:20

In this solo YouTube monologue, Mark Kohler argues that owners of S‑corporations with net revenue exceeding $184,000 should keep their payroll (reasonable compensation) at roughly $60‑70K, a figure he describes as aggressive but defensible. He anticipates accountant objections about audit risk and counters them by citing his extensive credentials: he teaches continuing‑education courses on reasonable compensation, has prepared thousands of S‑corp returns, and has interviewed former IRS agents who audited S‑corps. Kohler claims no client of his has ever been audited for taking a low reasonable compensation amount, and that the only downside to his recommendation is a modest increase in FICA taxes, not criminal penalties. He challenges accountants to produce a case where a one‑third allocation of revenue to payroll would cause trouble, positioning his approach as a low‑risk, high‑savings strategy.

Chapters

If she has over $184,000 of net revenue, I would argue day and night her payroll should not be any more than 60 grand, 70 grand. Now I know an accountant that's listening to this is already blowing a gasket. They are saying that is far too aggressive. Oh my gosh, they're gonna get audited. Let me just say a few things. I take every continuing education course on the planet every year on reasonable comp. I teach CE to lawyers and accountants around the country on reasonable comp. I have done over thousands of S corporation tax return, not just over 1,000, thousands of S corporation tax returns. I have interviewed prior IRS agents because they won't do it if they're sitting employees of the IRS, prior IRS agents that audited S corporations out of the Chicago office on my podcast. I have written prolifically on this. Can I just say, I have never, ever, ever had a client audited for taking too low of reasonable comp and be assessed additional FICA, which is all that would happen anyway. They're not going to go to jail for crying out loud. So If you out there as an accountant are already bristling going, oh my gosh, you're too, too aggressive on this. Show me the case where a 1/3 allocation in this would be a problem. I have never even had an accountant I train be audited for that. And what's the biggest risk? They pay a little bit more FICA.