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New Member
posted May 31, 2019 5:36:14 PM

Should the sole owner and sole employee of a C Corp file wages as officer compensation or salaries and wages?

TurboTax imports officer salaries as salaries and wages not officer compensation. Can this be adjusted so Quickbooks will export officer salaries as officer compensation?

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3 Replies
New Member
May 31, 2019 5:36:15 PM

This is officer compensation.

In QuickBooks, go to the Chart of Accounts and edit the account being used to book the officer compensation. Where it says "Tax-Line Mapping, change that tax line to be "Payroll - Officers" or something similar.

Updating QuickBooks will fix the import for next time.

In TurboTax - you do not need to re-import all the info again. You can remove the salaries and wages amount in TurboTax and enter that amount as Officer Compensation.

Level 1
Dec 15, 2020 1:45:36 PM

Thanks for the response SheriD, but is there any logic or regulation that you can point to for putting as Officer Compensation vs. Salary and Wages? I am not able to find any information about the difference between these. What is the final impact of classifying it as one or the other?

 

I am wondering if the following rationale should be used: If the sole employee is being paid for being an "officer" - i.e. running the company etc., then that part of the salary may be considered Officer Compensation. If the sole employee is doing the work in the corporation that any employee would do in order to generate revenue, that part of the salary should be considered Salary & Wages. Would this make sense? This is based on my understanding that the IRS is primarily looking to find out if Officers are being over compensated for doing nothing.

Level 1
Dec 5, 2021 7:55:43 PM

For anyone that finds this thread and has the same question - the reason seems to be what is stated in this answer to a different/related question:

  1. Any shareholder / officer wages should be reported on line 12, which is pulled from Form 1125-E.  The difference is the IRS wants to see detail of officer wages.  Line 13 is just wages of all other employees.