Could use some advice - LLC taxed as S-corp

[Ken Olson]

I hope everyone is and remains healthy and safe during these challenging times....

I'm a first time flipper and I could use some help/advice.  I've spent considerable time trying to get answers on my own but haven't succeeded on getting clarity on all of them.

I bought a condemned house in Sep 2018 and sold it Jun 2019. I cleared $60k and I'm trying to get as much sorted out correctly for taxes and business going forward. I set up a solo 401k during 2019 and am trying to ensure I have all the $$ in the right buckets. I then need some help from a tax perspective ensuring I am using the correct forms and filling in the right info.

I have taken $40k out of the profit and am trying to determine the most tax advantageous breakdown between deferred compensation and profit sharing, salary and dividends, employee and officer. The $40k break down as follows: $25k deferred salary (max as I'm over 50), added $8k as non-elective company contribution (profit sharing - 25% x $32k for S-corp)) equaling $33k of retirement funds in my 401k, leaving $7k ($40k-$25k-$8k=$7k). The $32k should be classified as either salary or dividend and the entire $40k needs to be split between employee and officer. I'm generally aware of the 'reasonable salary' requirement by the IRS.

1) Does anyone have any advice they can offer on how the employee/officer split should look?

2) Similarly, any advice on salary vs dividends?

If we can get through this the I need some help with the appropriate placement in the IRS forms (IE K-1, 1120s, schedule C, etc.)

[Ken Olson]

Thanks Steve. I had a CPA last year whom I paid a lot of money to for taxes and advice (advice/guidance wasn't provided).....and he was fired. So this year I'm cash challenged and having to figure out by myself. Reading IRS pubs is so not what I want to be doing but...REALLY not what I want to do...but I will to get through this year.

I have dedicated accounts for the business and I am using gnucash to track transactions and have a decent handle on all of the expenses. I believe the CoA could be improved as it was set up based on some advice from the previous CPA.