York Accountant: Owner Classification Drives Payroll Tax Errors
York, Pa. – October 12, 2026 -- Misunderstanding owner classification remains one of the leading causes of payroll errors among small businesses in York, according to David Riggs of Accounting Services of York, LLC, in a HelloNation article. Misclassification leads to incorrect tax payments and potential legal issues, the article says.
S corporation owners who work in the business must generally be on payroll
Under IRS expectations, S corporation owners who work in the business must be paid a reasonable wage before taking any distributions. Failure to comply may trigger audits or penalties, which makes correct payroll setup critical from the start, according to Riggs.