If I am the owner of a trade school, can I defer my salary?
I would like to ask someone who has a strong background in accounting:
I am starting a trade school in the U.S. (organized as an LLC) to train people to become venture capitalists and would like to know to following:
1) Can I get deferred compensation for myself – so that I can plow my salary back into the trade school?
2) Can I not get a salary – but instead, place my salary into an account where I can invest in startups if I want to?
I look forward to your answers!
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You should get yourself an accountant.
Try SCORE they are all volunteers and many are retired executives of large companies.
Sent this to the one CPA that I know of on this site. Maybe she’ll weigh in.
The answer is amazingly simple.
As a member of an LLC, you cannot be a salaried employee. There can be no salary for you to plow back or place into an account.
If you’re the business’s sole owner, the LLC is a disregarded entity; all of your business’s items of income and expense are passed-through to you. If there are other members, the LLC is a partnership that divvies its income and expenses according to the ownership agreement. In either situation, you’re not an employee.
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