ForumsTaxes and Payroll

How do I pay myself, Welcome Casey

If I was in your position I would do two things.

First I would talk to an accountant. This is a good time before the end of the year.

Second, I would talk to SCORE. SCORE is FREE both in person and online.

Good luck, LUCKIEST

How is an accountant actually paid? I am afraid of getting involved and paying for something I could do myself. I have always done my own taxes and I do payroll with Bank of America. Will an accountant dedicate time to explaining what I need to do for free? Thats partially why I am on this forum to find out some information. It appears everytime taxes gets brought up, you guys tell people to get an accountant. Is there any business owners that know how their business accounting works? Due to the nature of my business, the only active duty I have is the books! I do have an accountant that I talked with before I started the business, I just dont want to nag him and pick his brain full of questions if he isn't going to be doing all the work. Am I making sense or is that what he is there for? Thanks -Casey

Okay thanks, that sounds like good advice. Thanks. -Casey

I am also in Florida and am lucky enough that my father-in-law is an accountant. As a LLC, the State will consider you the same as a corporation for most things but you need to file form 8832 with the IRS. You are filing as a disregarded entity which is telling the IRS to "disregard" the fact that you have formed a company and allows you to file your taxes as an individual (sole proprietor) with a schedule "C" instead of a separate corporate tax return. If you have a partner, same thing but check that box. Much easier than all the extra paperwork required even as an "S" corp. The whole point of filing as a LLC is so you don't have to form a corporation or deal with all the filings required.

I am not an attorney or accountant. This is just what I've done.

I don't draw a salary but my husband does for insurance reasons. You will have to pay taxes on what you make whichever way you work it. If you pay yourself, it is a business expense but still taxable wage income to you. I think it's better to show more business profit for the purposes of business credit down the road. I take owner draws and there are some issues with payroll taxes that I still have to pay - this is where some google research would come in handy for you to make sure you comply with IRS rules if you don't want to pay an accountant. There are a lot of good articles out there written usually by someone at a University - just check the date and make sure it's current.

Watch out if you do start to make a good profit and don't file and pay during the year. They will hit you with fines and interest if you end up owing taxes for the year. The best bet in the beginning if you're making some money is maximize your withholding at your regular job. Smaller paycheck might not be fun but you might not end up owing.

Also, make sure you check out the worker's comp rules for your type of company with the State. Florida is strict and some industries you have to have WC insurance even for yourself if you don't file and get approved for an exemption.