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Reasonable compensation for purposes of salary to an employee/shareholder of an S corporation is defined as: Wages paid to a shareholder/employee that are commensurate with

Reasonable compensation for purposes of salary to an employee/shareholder of an S corporation is defined as:

Wages paid to a shareholder/employee that are commensurate with their duties and similar to what others business owners in a similar profession are paid in the same general area.

Whatever the shareholder/employee believes is reasonable.

An amount equal to or less than the standard deduction of the employee/shareholder.

A loan from the corporation to an employee/shareholder.

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