Heidi Isenhart | Estate Planning Attorney Orlando FLORLANDO, FLORIDA – Heidi W. Isenhart, a partner with the law firm of ShuffieldLowman, was recently selected as a 2014 Florida Super Lawyer, which represents this award for the fourth consecutive year.

Super Lawyers, owned by Thomson Reuters, recognizes attorneys who have distinguished themselves in their legal practice. The selection process is multi-phased and rigorous. Peer nominations and evaluations are combined with third-party research and validation of the attorney’s professional accomplishments.

Isenhart practices in elder law, Medicaid planning, guardianship, probate and trust administration, probate and guardianship litigation, estate planning and special-needs trusts. Her past honors include recognition as a Five Star Wealth Manager by Orlando Home & Leisure Magazine, voted as Florida Legal Elite by Florida Trend Magazine for eight (8) consecutive years; and, Best of the Bar by Orlando Business Journal. She has also been recognized for her outstanding level of pro bono work by the Florida Supreme Court, The Florida Bar’s Young Lawyers Division and the Florida Pro Bono Coordinators Association. Isenhart is a graduate of the University of Illinois, Urbana-Champaign with a B.S. and Regent University School of Law, Virginia Beach, Virginia with her J.D.

Shuffield, Lowman & Wilson, P.A.’s four downtown offices are located in Orlando, Tavares, DeLand and Daytona Beach. The firm is a 30 attorney, full service, business law firm, practicing in the areas of corporate law, estate planning, real estate and litigation. Specific areas include, tax law, securities, mergers and acquisitions, intellectual property, patent licensing, trademarks and copyrights; estate planning and probate, planning for families with closely held businesses, guardianship and elder law, tax controversy – Federal and State; non-profit organization law; banking and finance, land use and government law; commercial and civil litigation, bankruptcy and creditors’ rights, trust, probate and guardianship litigation; labor and employment, and environmental law.

The IRS has increased its audits of small businesses. A common issue is whether or not the owners or officers of an S-Corporation are paying themselves adequate, or for that matter, any salary. Often, S Corporation owners pay themselves little or no salary, and simply take their income through distributions reported on Form K-1 at the end of the year. This is done to avoid paying payroll taxes since none are due on corporate distributions but are clearly due on salaries paid to corporate shareholders.

The IRS looks at a number of issues.
1) Is the nature of the business such that revenue is driven more by the corporation’s capital, assets, and other employees, than by the shareholder’s personal efforts?
2) What are the qualifications and responsibilities, and how much time and effort is devoted to the business by the shareholder?
3) Is the shareholder being paid the same or less than non-shareholder employees?
4) What are comparable businesses paying for the same types of services?
5) Are the distributions substantially greater than the salary?
6) What is the financial condition of the business?

These are all factual issues to be determined on a case by case basis, but paying oneself little or no salary, while taking large distributions, is an excellent way to attract an audit. Shareholders should address this issue with their tax consultants in an effort to arrive at a reasonable balance between compensation and distributions.