"as you know loan more than $10,000"

You are working in the same calendar year, though. Can they pay it back by year end? If not, take the remaining balance as distribution. It's different when it's after year end, or even a running balance for loan to shareholder. But I don't recommend they leave $95,000 as distribution now and decide $125,000 is reasonable salary, and only pay the last quarter of that as payroll ($31,250) because that is 1/4 compensation and 3/4 distribution, and that is a bad ratio.

"Problem is company has no enough fund to run this large payroll. What would it be the next?"

Exactly why I brought up banking and taxes.

First, the minimal amount of Net Takehome paychecks for 2023 can end at $0 takehome after deducting taxes and what was already taken. And you might need to break it into chunks, working towards year end.

Here's an example:

He already took $95,000, but let's do our first paycheck as $30,000 gross. Their bank account does not have to cover $30,000; that's already been paid out. It has to cover (at a minimum in this example) what should have been the employee SS and Medicare taxes and the employer's taxes (SS, Medicare, Fed UI, and perhaps State UI). Let's pretend that comes to around $2,300. You would issue a paycheck that is:

$30,000 gross pay

$2,300 is owed by the employer for Employee taxes (to be paid out)

$27,700 net pay deduction towards repaying the shareholder loan (earlier distribution)

= $0 takehome.

Now the distributions are:

$95,000

- $27,700

= $67,300

Now you have a paycheck for no new money, and you have employer taxes owed:

$2,300 (same as employee for SS and Medicare)

$420 FUTA

= $2,720 (employer)

+$2,300 (employee)

= $5,020 <== company owes this from bank to pay payroll taxes owed on first paycheck (example)

That's the only new money that has to leave the bank.

And from now on, FUTA is done.

Not knowing his filing status, etc, and eliminating income tax withholding (assuming that's something he was taking care of already, and let that ride for 2023), a $30,000 paycheck Sept, Oct, Nov, Dec is pretty much the example base pay. It's the takehome that needs to be reduced, until the (earlier) distribution are mostly or totally offset.

This turns distribution into shareholder loan over a year end, if you want to let it ride (if it is under your $10,000 limit). Or, it turns shareholder loan at year end into distribution for the remainder that wasn't repaid through payroll Net pay deduction.

It's all just strategies. It's all just math.

(Let me know if you check my math and I got something wrong)