<prompt> Human: So I invested 40k into a startup I work for, and we have now obtained some VC and I am starting to get paid, does the money Im making now have to classify as income or can the business label it as paying back some of my investment in order to avoid taxes? I did receive stock for the investment sweat equity. I still own the stock percentage but could easily justify it by the sweat equity I put in.Both the business and myself are located wholly in the US.Want to be in the legal clear here and hoping someone can help me out.  <response>: Find a CPA. We have no idea about the structure of your company, the balance of your capital account if applicable, your basis, etc. You wont get a reliable answer from reddit. 