The IRS considers Sylvia to be a highly compensated employee for Beautiful Pictures,Inc.,which means that she met which one of the following criteria (assume that the previous year was 2015)?
A)either a current annual salary of more than $170,000; and, in the previous year, a 5% owner or a 1% owner of the employer's business whose annual pay was greater than $150,000
B)either an annual salary of more than $170,000; or, in the previous year, a 5% owner or a 1% owner of the employer's business whose annual pay was greater than $150,000
C)an annual salary exceeding $50,000
D)an annual salary less than $170,000

Question

Quizplus · Accepted Answer

The IRS defines a highly compensated employee based on either a high level of compensation (more than $170,000 in this context) or ownership interest in the company (being a 5% or 1% owner with annual pay greater than $150,000 in the previous year).

The IRS Considers Sylvia to Be a Highly Compensated Employee