[nickff]

Many locales have laws that do not allow remuneration above the 'reasonable wage', to prevent tax circumvention by having employers spread wage payments across multiple family members of employees, but I am not familiar with any jurisdiction with a minimum reasonable wage law or regulation. Could you please link some source for the claim that business owners are required to accept a 'reasonable wage'?

[topgrain2]

https://www.irs.gov/businesses/small-businesses-self-employe...

[nickff]

Yes, that is intended to disallow officers from avoiding taxes by being compensated via ‘loans’ and other means. I can’t find any case where dividends or buybacks were found to be violations of that rule. https://cpataxteam.com/blog/s-corp-owners-are-you-paying-you...

Do the math for yourself. Paying corporate taxes on profits, then dividend taxes on what gets paid out is not a savings versus paying income+payroll tax (which comes from money that is treated as an expense at the corporate level).

[topgrain2]

There are more taxes than federal income and corporate taxes. State taxes and especially the ~15% of wages that go to FICA also matter (the topic was small businesses, so presumably the owner's not making so much more than the FICA limit that this becomes negligible).