The company in question is an S-Corp. From 1/1 through 7/31, I worked as a W-2 employee for the company. During that time, the company was owned by a single person, who held 100% of the shares. I received normal paychecks through payroll the entire time.
On 7/31, the owner sold me 100% of his ownership stake and exited the company completely, leaving me as the sole owner of the company.
From 8/1 through 12/31, I expect the company to continue earning money. During this time, I'd like to avoid the employer half of FICA taxes incurred by paying myself through payroll. Instead, I'd like to take a year-end profit distribution.
I'm aware of the IRS rule that requires S-Corp shareholders to pay themselves a "reasonable" salary. However, I did receive paychecks from the company for over half the year. Is taking a single profit distribution at the end of the year, without taking payrolls from 8/1 through 12/31, ok in this situation?