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I just opened my accounts with BofA, but my understanding of things is that as the owner, you don't GET a paycheck. If you want to do a owner withdrawal, you simply make a transfer from your business account to your personal account using the online business suite and categorize it properly for the accountant.
I'm in a similar situation where I'll be paying my spouse as an employee, but my own "paycheck" will simply be a transfer from the Business Checking to the Personal Checking account, because I'm still the Sole Proprietor owner of the business. As you say, we are responsible for our own taxes, as we pay Self Employment tax, quarterly estimated taxes, etc. on the net profits of the business as a whole.
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Technically, you are supposed to send quarterly estimated payments to the IRS with Form 1040-ES for the appropriate quarter. However, I have yet to see anything that prohibits you from making multiple estimated payments for one quarter. You may no be able to completely avoid underpayment of estimated tax penalties, but you can reduce them. Since your income is earned when the business earns it not when you take it, the timing could be a bit off, but it might be better than nothing and it will keep you from having to send huge checks four-five times per year.
The quarters aren't quarters though.
1st Jan - Mar due 4/15
2nd Apr - May due 6/15
3rd Jun - Aug due 9/15
4th Sep - Dec due 1/15
Settle up with your 1040 or extension by 4/15 of the following year.
You are right, Mike - I was just using the term used by the IRS/State when referring to the "Quarterly" payments.
I know many contractors who are setup to make payments online with the State and IRS who deduct their estimated taxes and pay them each month, just because they don't trust themselves to keep that money set aside and not spend it in case of an emergency or whatever and leave themselves short.
Personally, I just have separate reserve interest bearing account setup and a percentage of all income goes into that account as it is deposited. Then I use BofA's Easy Tax service to make the payments.
I've found that the real key to avoid underpayment penalties is keeping really good books, which I'm sure you can appreciate as a CPA. :) EVERYTHING goes into Quicken Home & Business, every expense is categorized, every possible deduction is identified and tracked throughout the year. Business bills are payed from the business bank accounts, personal bills are from personal accounts, and where that's not possible (e.g., home office deductions, percentage of utilities for home office, etc.) then they are entered as a split. That way, at any point in time, I have the most accurate picture of what my bottom line is going to look like at the end of the year and can make my estimated tax payments to be as accurate as possible.
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I have set up online payroll with Bank of America, but have a question. There are options for paying employees or contractors, but not owners... my firm is a dual member LLC, with a few employees and several contractors. As an owner, I would like to take a monthly draw, but want to pay taxes when i take the draw. However, the owners shouldnt be responsible for paying employee taxes on ourselves.... how should i best manage this process?