How do I pay myself as a business owner?
Short Answer: It depends on your entity type. Owners typically take draws (sole prop/LLC) or salary + distributions (S-Corp).
Sole proprietors and many LLC owners pay themselves via owner draws — transferring money from business to personal. S-Corp owners generally must run payroll for a salary, then take distributions.
Common mistakes:
• Treating draws as payroll
• Taking S-Corp distributions without salary
• Not planning for taxes
What we recommend: Match your pay method to your entity type and build a plan for taxes and cash flow.
Still have questions?
If you’re not sure what applies to your situation, we can help.