S-Corp, 2 Employees (Wife & I), How do we capture self-employment tax as an expense? And are we using the correct version of Turbotax?

[DA960]

S-Corp, (Wife & I only), We run payroll as employees (The only employees) of the S-Corp and withheld the full 15.3%. We created and submitted W2's for full amount. How do we capture self-employment tax as an expense? Or do I need to modify W2 to reflect normal 7.65%? We entered our W2's into Turbotax and also created a Schedule K (For both of us) to pass through some minimal income. The business side of "Home & Business" Turbotax is looking for income. We deplete the account on the S-Corp side to show very little Net Income at year end.  How should I proceed for most logical and correct. We have not filed S-Corp taxes but did file the W2s. (I can still correct) Also, could I have used Premier Turbotax to further simply? I have used that version many times in the past for typical business income/1099/Home office.  --- Thank you in advance for your comments! 

[tagteam · Accepted solution]

S-Corp, 2 Employees (Wife & I), How do we capture self-employment tax as an expense?

If the S corporation paid each of you a salary and filed the requisite forms (e.g., 941s, W-2s, etc.), then you only need to enter your W-2s into TurboTax, as well as the K-1s you each received from the corporation.

Note that you are not self-employed; you are employees of the S corporation.

[Mike9241]

on the S-corp you only get a deduction for the employer's share of fica and medicare taxes along with any Unemployment Compensation taxes paid. you did file form 970 and if needed UC and withholding tax returns  returns with the state? employer's fica, medicare, UC taxes go on line 12 - taxes and licenses. you can not deduct your portion of the Fica and Medicare taxes or income tax withholding. 

[VolvoGirl]

Couldn't tell.  Does your W2s have SS & Medicare tax listed in boxes 4 & 6?  

For your personal return you need to use the Online Premier or Self Employed version to enter a K-1.   But you can use any Desktop program, even Deluxe.  All the Desktop programs have the same forms. You just get more help and guidance in the higher versions. You do not need the Home & Business program for your situation.  

Are you trying to prepare the 1120 S return?  You can't use Home & Business.  You need Turbo Tax Business.  It  is a separate program from Home & Business.  It is not available to do online or on a Mac.  And it will not do your personal 1040 return.

You can buy the Window's version here…..

https://turbotax.intuit.com/small-business-taxes

[DA960]

Thank you Mike9241 --

I get it now. I did not combine my employer's share of  SS/MED deduction on Line 12 for the 1120S. I only entered the FUTA/SUTA.  I had read through some information on the internet that implied I was taking that deduction on the personal tax side.  Anything to lower Net Income after W2 and distribution will help on the 1120s since I always leave some deposits to carry over.  Also to answer your questions; Yes, I did file all 941, 940 Fed & State/Qrtly & SUTA/FUTA throughout the year and am current.   So next up, I will have fun un-winding this version of Turbotax Home & Business back to the Premier version where I will just pull in my W2s and Schedule Ks.... and still maintain the home office & cars.  Thank you very much for your reply.

[DA960]

Thank you tagteam -

I received concurring information from another community member. I had learned that I need to take the deduction on the 1120s, Line 12. I did not enter the employer's portion of FICA. I had only entered the SUTA/FUTA. I now have to unwind the personal version of Turbotax and go back to the Premier version.

Thank you for your help.

[DA960]

Thank you VolvoGirl - 

I received concurring information from community members. I did not enter the employer's portion of FICA on Line 12 of my 1120s. I had only added my FUTA/SUTA.  I had made an error by reading internet information that made me believe the employer's portion was taken on the personal tax side.  To answer your questions: Yes, all W2's are done/good. I am using Turbotax corporate for the 1120s.  I now have to unwind this Home & Business version and go back to the Premier which I typically use for the personal side.  Thank you for your comments and help.