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dmask0
Level 1

Help understanding TT products for S Corp and Individual

I need help understanding the TurboTax family of products and steps in my situation. 

I work for company A and get W2

Spouse works for company A and gets W2

Spouse owns 50% of S Corp company B

In past, accountant handled S Corp filing and K2, but this year I want to file via prep and file everything via TT. 

 

I purchased "TT business" for S Corp to file and prep K1s.

I purchased "home and business" for individual tax prep.

 

I'm confused while inside "home and business" because I answered yes to owning a business with W2s or 1099s. and now it's asking for all the S Corp info (business profile, quicken import, revenue, expenses, etc). Should I have answered no there since we have "TT Business" purchased separately for the W2 and K1 prep? 

 

Thank you.

 

3 Replies
tagteam
Level 15

Help understanding TT products for S Corp and Individual


@dmask0 wrote:

Should I have answered no there since we have "TT Business" purchased separately for the W2 and K1 prep? 


Yes (you should have answered "No").

 

The question to which you are referring relates to owning a sole proprietorship (which you would file on a Schedule C in conjunction with your 1040).

 

You will use TurboTax Business to prepare your Form 1120-S and associated K-1(s) and then you will enter the information from the K-1 into your personal income return using TurboTax Home & Business.

 

Ensure that you prepare the return for the S corporation before your personal income tax return.

dmask0
Level 1

Help understanding TT products for S Corp and Individual

Thank you - makes sense now. 

Carl
Level 15

Help understanding TT products for S Corp and Individual

I don't know if this additional information will be helpful to you or not. But here goes.

You have to prepare and file the 1120-S corporate return first, before you can even start your personal return really. That's because it's impossible to complete your personal return until you have the K-1's issued from the S-Corp.

The 1120-S is due to the IRS by March 15th. The late filing penalty is $200 per owner, per month. So file one day late and you pay the penalty. If there's two owners of that S-Corp, that's a $400 penalty if you file on March 16th. So the moral here is, *don't* *be* *late*.

Do not file "ANY" tax return until *AFTER* you have completed *ALL* tax returns and are 100% satisfied with the results. Why? As an example, if you find an error on the 1120-S after you've filed, now you've got to file an amended 1120-S, possibly issue new "amended" K-1's which means you then have to amend your personal 1040 tax return. So while you don't want to be late with the 1120-S, for your own sanity don't rush it.

Since this is your first time doing the 1120-S on  your own, you would be well advised to pay for a review by a TurboTax qualified, certified, licensed tax expert. This would be especially recommended if your state also taxes personal income. Mistakes on the federal return usually translates into mistakes on the state return which could result in fines and/or penalties from both the IRS and your state. Those fines and penalties could make the cost of a professional review seem like a pittance in comparison. So I recommend you pay for the review or risk kicking yourself in the butt later for not having done so.

Now for TurboTax BUsiness you can't get that program under the "TurboTax Live" program. But if I recall correctly, towards the end when you're get to the point of ready to e-file it, you'll be given the option for a review if you want to pay for it.

Several years ago I used TTX Business to complete a 1041 estate return for a friend. Paid for the review and am damn glad I did. They found 2-3 errors that would have cost my friend dearly in the long run since they were the legally appointed administrator of the account. The best part in this case though, was that the cost of the review was paid for by the estate. So neither myself or the estate administrator really paid a dime for it.

 

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