When an employee/shareholder receives a business income allocation from an S corporation, what taxes apply to the business income allocation?

Question

Quizplus · Accepted Answer

Income from an S corporation passed through to an employee/shareholder is subject to income tax but not to FICA or self-employment taxes. S corporation distributions are generally not considered earned income for the purposes of self-employment tax.

When an Employee/shareholder Receives a Business Income Allocation from an S