Reasonable Compensation Calculator

How much should an S-corp owner pay themselves?

A rough estimated range for planning conversations — based on your industry, hours worked, role, and geography.

Illustrative · Planning tool · Not tax advice

This calculator is a planning tool, not tax advice. The output is a rough estimated range based on publicly available wage data and the inputs you provide. It is not a reasonable compensation study, does not consider all facts and circumstances the IRS weighs (training, duties, time devoted, comparability, dividend history, etc.), and should not be used as the basis for a compensation decision on its own. For a defensible reasonable compensation determination, engage a qualified CPA to prepare a formal study. See our Court & Trust Accounting and Taxation pages, or request a consultation.

Pick the closest match to what the business actually does.

Please choose an industry.

What do you actually do in the business?

Check every function that takes meaningful time — used to weight the base salary.

Check at least one function.

Average across the year. Include admin, sales calls, ops, and delivery — everything you'd bill if you weren't the owner.

Enter hours between 0 and 80.

Top-line revenue for the current or most recent full year. Used only for sanity checks.

Enter a revenue amount of 0 or more.

Business profit before deducting your W-2 salary or distributions. If you're not sure, use last year's P&L "net income" line and add back the owner comp you already paid.

Enter a number between -10,000,000 and 50,000,000.

Total years — not just years running this business.

Enter years between 0 and 60.

Where your work is performed. Base ranges are geographically adjusted.

Please choose a region.

Direct reports plus anyone reporting through them. Larger teams push the range up. Optional — defaults to 0.

Enter a number between 0 and 1,000.

Estimated reasonable compensation range

Mid-range estimate:

This is an estimate — not tax advice.

The IRS looks at the whole picture: training, duties, time devoted, dividend history, wage comparability, and more. A formal reasonable compensation study documents those factors in a defensible file. This tool doesn't do that.

Request a formal reasonable comp study →

Read our Taxation service page ↗

Want the full methodology?

Get the methodology write-up and the BLS reference table by email.

We'll send you the PDF that shows how the range is calculated, the wage-data references we used, and a one-page checklist for building a defensible reasonable comp file. Email only — no phone, no firm size, nothing else.

Enter a valid email address.

© Laléa & Black, LLP. Wage-range benchmarks are illustrative and drawn from publicly available Bureau of Labor Statistics Occupational Employment and Wage Statistics (OES) publications, adjusted for U.S. geography. Ranges are directional and change annually. This tool does not create a client relationship, is provided "as-is" without warranty, and does not constitute tax, legal, or accounting advice.