I own my own business and I need to make a paystub to show income being paid to myself. I have an LLC taxed as an S-Corp which allows me to be paid through Salary + Distributions.
Can I add Distributions to my Gross amt in my pay stub?
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letgetcc said:I own my own business and I need to make a paystub to show income being paid to myself. You cant just create a paystub - either you receive on with your paycheck or you dont. If you want to document a higher salary, you must record a higher salary and less "distribution". You cannot document "distributions" with a paystub.
Glitch99 said:letgetcc said:I own my own business and I need to make a paystub to show income being paid to myself. You cant just create a paystub - either you receive on with your paycheck or you dont. If you want to document a higher salary, you must record a higher salary and less "distribution". You cannot document "distributions" with a paystub.
So how do I document "Distributions"?
Glitch, here is my dilemna:
I applied for a business credit card... and they are asking for income documentation , I have been a student and have always relied on Household Income of 200K.
My salary coming from my LLC is only $67K or so I am going to receive the other $120K from "Distributions" (I believe that is what it is called)
The credit card company wants to see a paystub or 1040. Explained to them that this is first year of business so I can't supply 1040 till next year so they said a Paystub is acceptable.
So if I can't put 67K (Salary) + 120K (Distributions/Other Income) on my pay stub,
How do I document that other 120K income as proof of income?
Do I send paystub (only 67K) + other documentation? and what is this other documentation?
Message edited by: letgetcc on 2009-10-20 21:50:37 CDT
letgetcc said:I own my own business and I need to make a paystub to show income being paid to myself. I have an LLC taxed as an S-Corp which allows me to be paid through Salary + Distributions.
Can I add Distributions to my Gross amt in my pay stub?
If you don't know the ins and outs of this, then you need to get an accountant. Sounds like you are going blind.
letgetcc said:Do I send paystub (only 67K) + other documentation? and what is this other documentation?A current income statement for the business (annual and/or the most recent month) is about the best you are going to do. And perhaps a month's bank statement showing incoming deposits to support the income statement?
You're immediately profiting $200k annually from a business you just started this year?
Glitch99 said:letgetcc said:Do I send paystub (only 67K) + other documentation? and what is this other documentation?A current income statement for the business (annual and/or the most recent month) is about the best you are going to do. And perhaps a month's bank statement showing incoming deposits to support the income statement?
You're immediately profiting $200k annually from a business you just started this year?
K, hopefully Pay Stub + Those other statements will do the trick. It would have be much easier if I can put that Distribution on pay stub, but obviously want to document this correctly...
And yes the number should be accurate. I am not starting from scratch, btw...
Message edited by: letgetcc on 2009-10-20 23:33:06 CDT
As long as you can document to the only people who could really get you in trouble - the IRS - yes, put it on the same check (but with a different line item from your salary, obviously). If you use QuickBooks you can make sure that you apply the correct tax treatment to the distribution.
Is it simpler to do a separate check - you bet. Do you have to - nope. Put it on one check and you solve your issue. If you ever get asked about it from the IRS, you have your documentation AND you have separate items for salary and distribution... done.
slappycakes said: Is it simpler to do a separate check - you bet. Yes you could cut yourself a check for the "distribution" (actually, you really should anyways), but it'd be a regular check as if you were paying a vendor, not any sort of payroll check. Wouldnt hurt to also include a copy of that (both the check and the check voucher) with your income statement and other documentation.
What kind of business is this? In many cases, a low salary and a high pass-through income is a red flag to the IRS. An S-Corp owner who works for a business must receive a "fair" salary, which usually means comparable to what you'd get in the same position in a business you didn't own. Unless this business is very capital-intensive (e.g. it owns a rental property, and you manage it part time), you may want to give yourself a hefty raise.
ThePessimist said:What kind of business is this? In many cases, a low salary and a high pass-through income is a red flag to the IRSSounds like Monkey Business
letgetcc said:I applied for a business credit card... and they are asking for income documentation , I have been a student and have always relied on Household Income of 200K.
My salary coming from my LLC is only $67K or so I am going to receive the other $120K from "Distributions"So does your LLC actually bring in 200k per year, or are you dividing up the HHI of 200k via the LLC ?
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