The BEA collects tons of statistics on compensation by geography and vertical. If you file with a salary far below the norm for your role, location, and industry, and then take a distribution that brings your compensation above that norm, you should be audited.<p>That's roughly the current situation --- except that instead of codifying some reasonable standard reference for wages, it's up to a court to decide, which is not what an owner wants. I'm not advocating a Wage Panel.<p>You're don't appear to be arguing about process. You're arguing against the very idea of recovering payroll taxes from business owners who have deliberately filed with artificially low salaries so they can avoid paying FICA is arbitrary. I'm saying, what seems arbitrary to me is the fact that simply by organizing their business superficially differently, consultants can skip out on taxes that normal wage earners have to pay.