By Stephen D. Kirkland, CPA, CMC, CFF Originally published in The Value Examiner (January/February 2017) which is a publication of the National Association of Certified Valuators and Analysts. One key difference between successful and unsuccessful financial service firms is the way that partner compensation amounts are determined. Successful firms have strong compensation plans that help…
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Compensation Issues Common in Divorce
During marital dissolution, family courts look closely at the spouses' compensation amounts for multiple reasons. One of the most common reasons is to help determine a spouse’s ability to pay alimony and other types of support. In addition, if a spouse owns an interest in a closely held business, market-based compensation amounts are often needed…
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Helping S Corporations avoid Unreasonable Compensation Audits
© 2015 American Institute of CPAs - All Rights Reserved. Reprinted with permission from the June 2015 issue of Journal of Accountancy. Find out what entries on Form 1120S may trigger these audits. By Stephen D. Kirkland, CPA, CMC, CFF Since compensation is subject to employment taxes (including Federal Insurance Contributions Act taxes) and distributions…
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Contingent Compensation
Contingent compensation may be a discretionary bonus or an amount to be determined by a written formula. Either way, it should meet the same standards of reasonableness and compensatory intent as traditional salary compensation. To determine whether the amount is reasonable, carefully consider the facts and circumstances which existed at the time the bonus was…
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