When should you pay yourself? Paying yourself on the wrong payroll schedule can create IRS red flags, cash flow crunches, and painful cleanup later.

In this episode, we break down monthly, quarterly, and annual payroll for S Corp owners. You’ll learn what the IRS actually expects, how reasonable salary works, why quarterly “true-ups” can create cash flow problems, and how to structure payroll to stay compliant without overpaying in taxes.

We also cover catch-ups, slowdowns, bonuses, zero payroll returns, and a critical but often-missed strategy involving self-employed health insurance and HSA contributions that can reduce FICA taxes.

If you’re an S Corp owner trying to pay yourself the right way and avoid IRS attention, this episode walks you through exactly how to do it.

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners:
https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters

(01:00) The Reasonable Salary Requirement for S Corps
Why S Corp owners must take W-2 payroll and why determining reasonable salary is the first step.

(03:10) Payroll Software and Filing Requirements
Why using payroll software matters and how missed filings create serious problems.

(04:00) Monthly and Biweekly Payroll Explained
How spreading your salary evenly works and why this is the most common recommendation.

(05:30) True-Up Payroll. Quarterly and Annual Options & Cash Flow Risks
How quarterly and annual true-ups work and how draws get reclassified as wages. Large quarterly tax payments can create cash crunches.

(08:45) Zero Payroll Returns and Compliance Traps
Why you still need to file payroll returns even when no payroll is run.

(09:30) Catch-Ups, Slowdowns, and Bonus Payrolls
How to adjust payroll when income, workload, or profitability changes.

(11:45) Self-Employed Health Insurance and HSA Adjustments
How S Corp owners can increase reasonable salary without paying extra FICA taxes.

(15:30) The Safest Payroll Strategy for Most Owners
Why consistent payroll timing protects cash flow and reduces IRS risk.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.

Paying yourself wrong can trigger IRS issues, messy books, and unexpected tax bills.

In this episode, we break down exactly how LLC owners should pay themselves in 2026 based on their entity type and tax election.

You’ll learn the 3 primary ways business owners get paid: owner draws or distributions, payroll, and guaranteed payments. We explain which payment methods are legally allowed for single-member LLCs, partnerships, and S corporations, and why running payroll as an owner is prohibited unless you have an S corporation election.

We walk through how each method is taxed, how it shows up in your financial statements, and why owner draws do not reduce business profit even though they reduce cash.

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners:
https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters

(00:45) Why Paying Yourself Correctly Matters
Improper owner pay can create audit risk, illegal compensation setups, and accounting problems that surface later during tax season.

(01:25) Owner Draws and Distributions Explained
What an owner’s draw actually is, how it works, why no taxes are withheld upfront, and why draws don’t reduce business income.

(02:55) Guaranteed Payments for Partnerships
How guaranteed payments work in partnerships, when they’re used, how they’re taxed, and why they’re different from draws.

(04:10) Paying Yourself as a Single-Member LLC
Why single-member LLC owners can only take owner draws, and why running payroll to yourself is not allowed by law.

(05:05) Paying Yourself in an LLC Partnership
The two legal options for partners.

(06:00) Paying Yourself as an S Corp Owner
Why S Corps require a reasonable salary, how payroll and distributions work together, and where tax savings come from.

(07:00) How to Document Owner Pay Correctly
How draws hit the balance sheet, how payroll hits the income statement, and why documentation matters for audits.

(09:30) What to Do Next as an LLC Owner
How to choose the right pay method, set up a system, plan for taxes, and avoid common compensation mistakes going forward.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.

You formed your LLC. Good job.
But many business owners unknowingly make critical mistakes after formation that quietly destroy liability protection, trigger audits, and limit growth.

In this episode, Mike walks through the 10 most common LLC mistakes business owners make in 2026 and explains exactly how to fix them. From mixing personal and business finances to ignoring tax planning and misclassifying owner compensation, this episode gives you a practical framework to audit your business and protect it the right way.

If you want your LLC to survive and thrive, not just exist on paper, this episode shows you what to fix now before it becomes expensive later.

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners:
https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today. Click here or visit:
https://taxelm.com/demo/

Chapters

(01:00) Mixing Personal and Business Finances
Why commingling funds breaks liability protection and how to properly separate accounts without overcomplicating things.

(02:00) Failing to Maintain LLC Compliance
Annual reports, renewals, and filings business owners forget that can cause administrative dissolution.

(03:20) Ignoring the S Corporation Opportunity
How LLC owners overpay self-employment taxes by not exploring an S Corp election at the right time.

(04:10) Misclassifying Owner Compensation
The difference between owner draws and W2 payroll, and why paying yourself the wrong way creates tax problems.

(05:45) Operating in the Wrong State
Why forming an LLC in one state but operating in another requires foreign registration.

(06:40) Skipping Tax Planning
Why taxes are often a business owner’s biggest expense and how proactive planning changes everything.

(07:30) Failing to Update State Filings
What happens when partners, addresses, or business purposes change and filings are not updated.

(08:10) Treating the LLC Like a Hobby
How hobby loss rules work and why consistent losses without profit motive raise red flags.

(09:00) The LLC Audit Checklist
Simple steps to audit your LLC today, fix weak spots, and build better habits going forward.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.

Thinking about forming an LLC in 2026? In this episode, Mike breaks down how to set up an LLC step by step, what “free” really means, state filing costs, common mistakes to avoid, and why an LLC can act as an insurance policy for future S Corp tax savings. Perfect for new and growing business owners who want clarity without the confusion.

If you want a clean, simple business setup that protects you now and gives you flexibility later, this episode gives you the roadmap without the legal confusion.

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners: https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today! Click here or visit: https://taxelm.com/demo/

Chapters

(01:00) Why Form an LLC in 2026
The 3 core reasons business owners form LLCs. Liability protection, credibility, and flexibility for future tax planning.

(02:10) Why an LLC Is an Insurance Policy for an S Corp
How an LLC allows you to elect S Corp status later and why sole proprietors do not have that option.

(03:00) What “Free” LLC Setup Really Means
State filing fees, unavoidable costs, and what online “free” services actually do.

(03:55) The Step-by-Step LLC Setup Process
Choosing a business name, selecting a registered agent, drafting an operating agreement, filing with the state, getting an EIN, and opening a business bank account.

(06:05) The Biggest LLC Mistakes Business Owners Make
Why not using the LLC, mixing funds, missing renewals, and following bad internet advice cause legal and tax issues.

(07:40) Bonus Tips to Strengthen Your LLC
Operating agreements, separating finances, tracking expenses, and setting up bookkeeping the right way.

(08:30) When to Consider an S Corporation
$50,000 in profit is a common tipping point and how an LLC makes the transition easier.

(09:00) Final Takeaway
How to use an LLC to protect yourself today while setting up smarter tax planning for the future.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.

If you are already behind on your taxes in January, there are four tax tasks you cannot skip.

In this episode, we break down the four financial tasks every business owner needs to complete in January to start 2026 clean and organized. Mike explains why unfinished bookkeeping leads to missed deductions and unnecessary stress, how to properly review your financials, and why most tax issues begin long before filing season.

We also cover the importance of creating a simple financial summary document, meeting the January 31 1099 deadline, and building a proactive tax plan early in the year instead of scrambling in December.

If you want 2026 to be more profitable and less stressful, this episode shows you exactly where to start.

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners: https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today. Click here or visit: https://taxelm.com/demo/

Chapters

(00:37) Close Out 2025 Before You Move Forward
Why unfinished bookkeeping follows you into the new year.

(01:00) How to Review Your Books the Right Way
What to check in your income statement and balance sheet for accuracy.

(02:55) How to Organize Tax Documents Properly
Why storing receipts and records now saves stress later.

(03:50) The Financial Summary Document Every Owner Needs
A simple snapshot that shows assets, liabilities, and insurance in one place.

(06:36) Why Advisors Love This One Document
How it leads to better advice, faster decisions, and smarter planning.

(08:00) The January 31 1099 Deadline
Who needs a 1099, who does not, and what payments count.

(11:07) Implementing Tax Strategies Throughout the Year
Why spreading strategies across the calendar leads to real savings.

(13:24) The Bottom Line for a Strong 2026
Clean books, clear visibility, timely filings, and a tax plan that works.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.

Are you still guessing when it comes to 1099s? Most business owners are. And every January, that confusion turns into stress, penalties, and last-minute cleanup that could have been avoided.

In this episode, Mike Jesowshek breaks down everything small business owners need to know about 1099-NEC and 1099-MISC forms, who needs one, who doesn't, the deadlines and the penalties that add up fast.

If you want January to feel calm instead of chaotic, this episode gives you the clear rules and simple process to get compliant without overthinking it.

🧾 Good systems prevent tax headaches. Tax Bandits lets you file 1099s electronically and reuse contractor info each year.

Use my link to streamline your 1099 process 👉 https://secure.taxbandits.com/register/?ref=taxsavingspodcast

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners: https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today! Click here or visit: https://taxelm.com/demo/

Chapters

(01:00) What is a 1099?
Mike explains how 1099s work, why the IRS requires them, and how they are used to match income across businesses and contractors.

(02:12) 1099-NEC vs 1099-MISC
Which form applies to contractors, which applies to rent, and why mixing them up creates problems.

(03:30) The Real 1099 Deadlines
Why January 31 matters, how weekends affect filing dates, and what business owners must send and file by the deadline.

(04:55) IRS Penalties That Add Up Fast
Late filing penalties, intentional disregard penalties, and how missing multiple forms can quickly turn into thousands of dollars owed.

(06:40) Who Actually Needs a 1099
The $600 cumulative rule, common misunderstandings, and why splitting payments does not avoid filing requirements.

(08:20) Common Exceptions Most Owners Miss
When corporations, payment processors, foreign contractors, employees, and personal payments do not require a 1099.

(10:15) Why Credit Card Payments Change Everything
How payment processors issue 1099-Ks and why that removes your filing obligation.

(11:30) The 4-Step Process to File 1099s Correctly
Collect W-9s, prepare the forms, send copies to recipients, and file with the IRS the right way.

(13:05) The Biggest 1099 Mistakes
Why missing W-9s and messy bookkeeping cause late filings and penalties every year.

(14:45) How Software Simplifies the Entire Process
Why e-filing tools save time, reduce errors, and make year-over-year filing easier.

(15:40) The 2026 Rule Change Every Business Owner Should Know
The new $2,000 filing threshold, inflation adjustments, and how this change affects future planning.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for

Send us a text

Happy Holidays, and thank you. This episode is a personal thank-you to the Small Business Tax Savings Podcast community. We reflect on nearly eight years of the show, including over 400 episodes and more than 1.5 million downloads. At the core of this podcast is one mission; Helping small business owners pay the least amount in taxes legally, without stress or confusion.

Let’s make 2026 the year you get proactive about tax planning from the start.

If this podcast has helped you in any way this year, there are a few small things you can do to help us continue helping more business owners:

- Leave a review on Apple Podcasts, Spotify, or wherever you listen
- Subscribe to our YouTube channel
- Share this podcast with another business owner
- Follow us on social media to stay connected

If you’d like to go deeper, you can download our Tax Savings Starter Kit. Inside, you’ll find:

- A complete list of common business deductions
- Real case studies showing how business owners saved $5,000–$25,000
- Access to a bonus discovery call with our team

👉 Get the Starter Kit here: https://taxsavingspodcast.com/starter-kit/

For business owners who want hands-on help implementing the right tax strategies, we also created TaxElm. It’s designed to guide you step by step, with full access to our team of tax professionals throughout the process.

🚀 Book your free demo call today! Click here or visit: https://taxelm.com/demo/

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.

Do you really have your tax planning handled? The thing is, many business owners are making a critical mistake that will become even more expensive by 2026.

In this episode, Mike Jesowshek, CPA, sits down with Mark J. Kohler to expose the biggest tax planning failure business owners make. Confusing knowing strategies with actually applying them. Mark explains why tax savings disappear at the implementation level, how poor execution creates long-term consequences, and why retirement accounts are one of the most overlooked areas where this mistake shows up.

👉 Get the Free Tax Savings Starter Kit Built for Small Business Owners: https://www.taxsavingspodcast.com/starterkit

🚀 Book your free demo call today! Click here or visit: https://taxelm.com/demo/

Chapters

(01:02) Why Most Tax Strategies Never Get Implemented
Many business owners think they are doing tax planning, but when you look at their tax return, the strategies are missing.

(03:05) Tax Strategy vs Tax Compliance
There is a major disconnect between tax advisors and tax preparers.

(05:18) What “Self-Directed” Really Means
Wall Street uses the term self-directed loosely. Mark explains the real definition and why traditional brokers do not promote it.

(07:04) What You Can Invest in With a Self-Directed IRA
Real estate, private businesses, lending, crypto, precious metals, and more. Mark walks through the types of investments retirement accounts are legally allowed to own.

(09:36) Prohibited Transactions and IRS Red Flags
It is not about prohibited assets. It is about prohibited people and personal benefit.

(12:02) Can You Be Active in Retirement-Owned Investments
You can make decisions, write checks, and structure deals, but you cannot personally perform labor or manage properties.

(14:01) Cost and Setup of a Self-Directed IRA
Many people assume self-directing requires hundreds of thousands of dollars.

(15:52) Employer 401ks vs Self-Directed Plans
Why most employer-sponsored 401ks restrict your options and how entrepreneurs can set up plans that allow true self-direction.

(18:06) When Self-Directed IRAs Are Not a Good Fit
Self-directing requires time, focus, and discipline. Mark explains when investors should wait or choose simpler options.

(19:33) How to Get Started the Right Way
Education comes first. Mark shares resources, podcasts, books, and next steps for learning before investing.

Podcast Host:

Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
Join TaxElm: https://taxelm.com

🚀 Visit: https://www.TaxSavingsPodcast.com

🚀 Check Out TaxElm: https://taxelm.com/

🚀 Join our Free Facebook Group: https://www.facebook.com/groups/taxsavings/

🚀 YouTube: www.TaxSavingsTV.com

👋🏼 GET IN TOUCH
You can Tweet @MJesowshek with any feedback, ideas, or thoughts about the lessons you've learned from the episodes. We want to thank you personally for tuning in 🙏

🙌LEAVE A REVIEW
If you enjoy the podcast, please leave a 5-star review on Apple Podcasts or Spotify—it helps more business owners find the show ⭐

🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.