An S-Corp just avoids double taxation. Salaries paid out are subject to FICA. As for the remaining business income, each shareholder would still owe taxes based on how much of the business they own. This is different than a C-Corp where the business income would be taxed at the corporate level in addition to the owners paying income tax on their salaries. And if the owners of a C-Corp decided to pay themselves huge dividends to avoid normal income taxation, that would raise red flags.

In California, S-Corps pay a 1.5% franchise tax on net income (minimum $800). You pay this even if your net income is zero or negative. You pay this no matter what.

Disclosure: I'm also not a CPA.