Salary vs Distribution Calculator for Food Truck

Most food truck owners start as solo operators — you're the owner, head chef, cashier, and truck driver all in one. In the early days, you take whatever cash is left after expenses. But as your food truck business grows and you start thinking about a second truck, hiring a manager, or just creating a more sustainable lifestyle, the salary-vs-distribution question becomes critical. If your food truck is structured as an S-Corp (which makes sense once you're netting $40,000+ per year), you're required to pay yourself a "reasonable salary" before taking distributions. For a food truck owner-operator, the IRS considers $30,000–$50,000 a reasonable salary depending on your market, hours worked, and revenue. Everything above that can come out as a distribution, which avoids the 15.3% self-employment tax. The math matters: on $80,000 in net income, paying yourself a $40,000 salary and taking $40,000 in distributions saves roughly $6,000 in self-employment taxes compared to taking it all as salary. But don't set your salary too low — the IRS scrutinizes food service operators who pay themselves $20,000 while their truck nets $100,000. The real inflection point for food truck owners is the decision to scale: when you hire a manager to run your first truck and you step into an ownership role, your reasonable salary should reflect your actual operational involvement, not just your ownership.