How do I setup an S-CORP for rental/investing (stock trading) business?

Discussion in 'Starting a Business' started by rysmbu, Feb 4, 2021.

  1. rysmbu

    rysmbu
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    I am thinking of setting up S-Corp and have few questions.

    Business Activities:

    1) Rental business for property to be owned by the S-Corp
    Revenue : 20K approx.
    Income after expense will be less than 14K
    2) Investment / Stock Market Trading

    Questions

    1. Is Rental business and Investing considered purely a passive Income activity
    2. Can I take all Rental Income as distributions without paying myself a salary
    3. If I need to pay myself salary, what should be the guidelines
    4. If I have a Trade windfall and have capital gains of 50-100K in a year, can all be taken as distribution after taxes
    5. What is the probability that IRS will look at this setup and impose fines and cancel S-Corp election, if there is ZERO payroll taxes

    Reason

    My goal is to reorganize my Rental / Investment assets into S-Corp. This can help getting Federal-Student-Aid for my kid. Small business assets are excluded from Federal student aid FAFSA calculations.
     

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