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musicmafia
Level 4
March 15, 2021
Question

Need Expert Clarification on TT Business Question Regarding Officer Compensation During e-Filing

  • March 15, 2021
  • 2 replies
  • 0 views

Although others have asked about this in this forum, a number of experts have replied with completely contradicting answers. As such, confusion still exists on this topic. If you know the correct answer, PLEASE offer a complete explanation.

 

When you go to e-file an S-Corp return in TT Business, the program asks three questions that could be interpreted any number of ways. There is no help in the program. The questions are:

 

1. Claiming officer compensation? Y or N. Does this mean compensation from W2 forms or are they specifically looking for compensation OTHER than W2?

 

2. Number of officers with compensation? If you claim YES on Q1, this line requires a numerical response. Again, does this mean compensation from W2 forms or are they specifically looking for compensation OTHER than W2?

 

3. Number of employee W2's issued? Does this include the W2 for the owner/officers or only employees OTHER than owner/officers?

 

SCENARIO: If you are the sole owner/officer of the S-Corp and you pay yourself a W2 and take no other money or compensation out of the business, what should your answers be to these questions and WHY?

 

Corp returns are due today and I am stuck unable to file because of this confusion. We really need clarification about this as there is no help in the program.  Thanks!

2 replies

musicmafia
Level 4
March 15, 2021

SAMPLE SCREEN

musicmafia
Level 4
March 16, 2021

Went to online support in my account, chose the TT BUSINESS software in the dropdown box and was given a number for business support. Called the number, there was no option to receive a call back (as in previous years) so I was forced to wait on hold for over an hour listening to the same elevator song loop. Finally got through to a rep who was absolutely clueless, yet kept me on the phone for 45 more minutes. He finally admitted he knew nothing about the TT BUSINESS software, did not have a copy of it for reference and was not aware of a department that provided support for TT Business. 

 

I asked if he could escalate me to a level 2 tech or supervisor or someone who might be able to help. He chatted with a supervisor who told him to tell me to call ANOTHER 800 number supposedly for the TT Business department to help me. Two hours wasted. I hang up, dial the number and the number is for Quickbooks, which I do not use. 

 

Now I'm back to the original 800 number (estimated wait 1 hour) hoping for a more knowledgeable CSR. This is so unnecessary and frustrating. These questions in the TTB program should be written differently or explained. 

musicmafia
Level 4
March 14, 2022

Well, it's that time of year again, so I bumping this since the issue is still unclear.

LudwigVan_fan
Alumni - Champ
Alumni - Champ
March 14, 2022

I'll give this a shot.

 

1.  Officer compensation...Compensation paid to officers should be on W-2.  If it's compensation, why wouldn't it be on W-2?   Distributions to officer/shareholders that are treated as distributions on Sch K would not be entered here and are not treated as "compensation".   So, officer compensation would be included on W-2.  In the past, and perhaps currently, there existed a large audit issue regarding S Corps and Officer compensation.  Small S Corps would often times NOT pay officers compensation, but included everything in Sch K & Sch K-1.  Issue was/is that officers are statutory employees.  As such, if they perform any work for the S Corp, they should be compensated for that work.  The issue was the avoidance of SS & Medicare taxes on payroll.

 

2.  I would say yes, this the number of officers that received a W-2.  As state above, what could be compensation from the S Corp to the officer that wouldn't be on W-2?  If by chance there is some sort of "compensation" from the S Corp to the officer and not on a W2, it should be here.  But I would think "claiming officer compensation" in #1 would go along with #2, officers getting the compensation.

 

3.  Number of employee W2s...include officer and employee W2s issued...total.

**Disclaimer: Effort has been made to offer correct information; but due to the discussion forum limitations, the poster disclaims any legal responsibility for the accuracy of the poster's response**