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document S-Corp Hard Money Facts, Net Savings
By Jason Watson (Google+) Posted August 31, 2017 Sales pitch alert! If you use the Watson CPA Group for your payroll, corporate and personal tax preparation, and business consultation needs, our annual fee will generally be about $2,640. Because it is a core competency for us, we have created an...
31 Aug, 2017 Views: 0 Comments: 0
document Other W-2 Income
By Jason Watson (Google+) Posted August 31, 2017 You might not reap all the benefits of an S Corp election and subsequent self-employment tax savings if you have other W-2 income. Let’s say you are an IT consultant for ABC Company, and you also do some outside consulting. If ABC Company pays...
31 Aug, 2017 Views: 0 Comments: 0
document Other Formation Considerations
By Jason Watson (Google+) Posted August 31, 2017 There might be some situations where layering entities or creating a brother-sister or parent-child type of overall structures makes sense. Holding Company and Operating Company This is one of the most common situations where you own two...
31 Aug, 2017 Views: 0 Comments: 0
document Quarterly S Corp Payroll
By Jason Watson (Google+) Posted August 31, 2017 Throughout this book we make reference to running payroll quarterly. Before we discuss the reasons why, if you have a staff where payroll is ran every two weeks the quarterly S Corp payroll concept might still apply so please keep reading. The...
31 Aug, 2017 Views: 0 Comments: 0
document Reasonable S Corp Salary Theory
By Jason Watson (Google+) Posted July 23, 2017 Determining a reasonable salary is the hardest part of running an S corporation. What the heck do I pay myself? Before we get into that, let’s discuss why shareholder salary needs to be just above bar napkin quality and just below NASA precision. ...
18 Aug, 2017 Views: 0 Comments: 0
document Estimated Tax Payments, Withholdings Issues
By Jason Watson (Google+) Posted August 16, 2017 Estimated tax payments change as well when you have an S-Corp, especially the first year. Generally speaking, you are required to pay at least 100% of your prior year tax liability or 90% of your current year tax liability whichever is lower. If...
18 Aug, 2017 Views: 0 Comments: 0
document Reasonable Salary Recap
By Jason Watson (Google+) Posted July 23, 2017 Keeping your salary low is what drives the savings in an S corporation. Recall that $10,000 in salary costs you about $1,410 in payroll taxes. However, through the IRS Fact Sheet and several tax court cases, the assignment of reasonable shareholder...
16 Aug, 2017 Views: 0 Comments: 0
document Reclassify Shareholder Distributions
By Jason Watson (Google+) Posted August 16, 2017 Since payroll is usually processed at the end of the quarter, at times we need to re-classify prior shareholder distributions as shareholder wages (and perhaps employee reimbursements). Here is a sample journal entry for an S Corp shareholder...
16 Aug, 2017 Views: 0 Comments: 0
document Cash Needs, The Zero Paycheck
By Jason Watson (Google+) Posted August 16, 2017 If you use the Watson CPA Group for processing your S corporation payroll, we work with you to determine the reasonable shareholder salary. About 3-4 weeks prior to the due date, we provide a “cash needs” email and a corresponding text...
16 Aug, 2017 Views: 0 Comments: 0
document Processing S Corp Payroll
By Jason Watson (Google+) Posted August 16, 2017 We’ve discussed the theory behind calculating a reasonable salary. You are also aware of the benefits of an S corporation such as K-1 income being taxed at the income tax level only, and not subjected to payroll taxes such as Social Security,...
16 Aug, 2017 Views: 0 Comments: 0