How much should I pay myself?

Recommendations for an Inspector-owned Single-Member LLC

Written by Nick Gromicko
Updated over a week ago

Here's a link to a post on InterNACHI Inspector Forum that addresses this question specifically:  How much should I pay myself as the owner of a Single-Member LLC?

InterNACHI's Legal Counsel Joe Denneler provides his opinion below:

In general, a LLC 100% owned by an individual is considered a single member LLC which is disregarded for tax purposes. As such, the owner of the LLC does not take payroll and instead would generally take out any funds from the LLC bank account as owner distributions. For tax purposes, 100% of the net earnings (gross income – valid business expenses) is subject to income tax and self-employment taxes. The owner is taxed on the net earnings regardless of if the owner takes the funds out of the LLC bank account as owner distributions. So owner distributions (taking money out of the LLC) does not impact the taxes.  

It is recommend the owner speak with a qualified legal and tax professional for guidance on entity structure and tax reporting.

The author of this communication is not a lawyer licensed to give legal advice or perform legal services.  Information conveyed in this communication is general information only and does not provide legal advice or opinions. The information conveyed in this communication should not be construed as, and should not be relied upon for, legal or tax advice in any particular circumstance or fact situation.  The information conveyed in this communication may not reflect the most current legal developments. No action should be taken in reliance on the information contained in this communication and we disclaim all liability in respect to actions taken or not taken based on any or all of the contents of this communication to the fullest extent permitted by law. The author of this communication does not represent InterNACHI, or any other party, as an attorney. An attorney should be contacted for advice on specific legal issues.

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