S Corp Questions

[luckyaces09]

Hi everyone,

I had a few quick questions I was hoping to get answered. I am a single member LLC filing as an S Corp

1. For salary/wages paid, I took the maximum HSA deduction of $3600. Would I say my salary is $50k or $50k-$3600.

2. Assuming my business was profitable and made $100k after paying myself a salary, do I say the business made a distribution for the same amount ($100k) during 2021 to shareholders (myself)  during the year end assets are zero?

3. I had a loss on schedule M2 carried over from the previous year. Where in the software would I report that?

Thank you

[ThomasM125]

Your salary would be $50,000, you wouldn't deduct the HSA contribution from it.

Your distribution would be equal to the money you withdrew from the business, not including what you took from your salary.

The prior year loss on schedule M-2 on line 8 gets entered on line 1 on Schedule M-2 for the current year.

[luckyaces09]

So my salary would be 50k but my box 1 on the W2 would be 50k-hsa contribution?

I'm having a hard time understanding distribution.. if my company was profitable at the end of the year and I am a single member s corp, would the distribution amount be equal to the total net profit?

Where in the actual turbotax software can I access schedule M2? I can't seem to find it in the business version.

Thanks 

[PatriciaV]

1. Your W-2 Box 1 should reflect your actual taxable wages of $50,000.

2. If you took $100K from the business and deposited in your personal account, then you would report a $100K distribution to yourself. However, if you withdrew less than the total income amount, then you would report exactly the amount you withdrew for personal use.

3. Schedule M-2 is on Form 1065 p4-5, near the end of the form. 

1. Open your return and click on the Forms icon in the TurboTax header. 
2. Click on the form you need in the left column to open it in the large window. 
3. Scroll down to the bottom for Schedule M-2. 

Note that any amount in black comes from another form and cannot be changed. If you enter something and it turns red, click the Errors icon above the list of forms to display the error below the form.