This is kind of a nothing-burger. Corporate officer/shareholder physically injured himself on the job, used his status as an employee to pay himself a legal se

This is kind of a nothing-burger. Corporate officer/shareholder physically injured himself on the job, used his status as an employee to pay himself a legal settlement, which would normally be taxable, but not for physical injury. The settlement seems too high to me for the relatively minor nature of his injury, but he got around that by hiring separate lawyers to arrive at a "reasonable" number. The article starts out on a weak note however: >the general rule is that any money you earn from your business is taxed twice. No, that's not the "general rule". That is only for corporations which are organized by default under subchapter C of the tax code ("C-corp"). For the very reason of double taxation, most small businesses are indeed organized as pass-through entities, such as S-corp (subchapter S), partnerships, or even sole proprietorships. S-corps in particular are used to reduce self-employment tax (Soc. Security) based on "reasonable compensation" for officer/employees. There is very little reason for a small business owner to choose the C-corp entity.