The IRS can reclassify S corporation distributions as wages
![](https://bizvalcpa.com/wp-content/uploads/sites/7/2016/09/Group-167-1024x590.png)
If you run your business as an S corporation, you’re probably both a shareholder and an employee. As such, the corporation pays you a salary that reflects the work you do for the business — and you (and your company) must remit payroll tax on some or all of your wages.