Cost
You list the owner's tasks and how their time splits. Each task is priced at its own BLS wage. It fits an owner who splits time across several business functions, and the app marks it Most popular.
Market
You pick the one occupation that best matches the role, plus an experience level. It has fewer inputs and fits a role that closely matches a single job title. It also uses BLS wages.
Income
This uses no BLS wage data. You enter the company's Fair Market Value (Start of Year), its FMV Increase (Before Owner Compensation), a Target Return on Equity between 1% and 50%, and the Basis for this rate. It's best when comparable wage data is missing or thin. If the result is $0 or less, the report shows as inconclusive: it has no PDF and can't be finalized. Change the answers or switch to Cost or Market.
Who can use which
- Tax professionals: all three, whatever your plan.
- S-corp owners running their own report: Cost and Market only.
- Your client's questionnaire: Cost or Market only. You enter Income inputs yourself.
Switching
You can switch approach until you finalize. A generated report needs generating again after a switch. The answers for the approach you leave are kept in case you switch back. If a questionnaire is out, the app asks first (Switch and invalidate). The link then stops working and, if the client has an email on file, they're told the request was withdrawn.
A report always uses exactly one approach. For the formulas and sources behind each one, read the methodology.
Still stuck?
Email help@wageproof.com, or send us a message from the ? button on any page of the app.