I'm using TurboTax Home & Business (Desktop Edition) and I have a single member LLC. I'm having issues figuring out how to report payments from my business (LLC) to me personally. I run a social media marketing agency, started last year and did not have any profit so I did not have to worry about this problem. This year things have gone extremely well and I'm entering my numbers into last years TurboTax to try to get a baseline of what I need to get ready to pay (And hopefully to see how I can reduce my taxes before the year is over).
I've done research but still not fully sure how to record payments to myself. There are three options for recording payment in TurboTax, a W-2, 1099 and Contract Labor (Business Expense). None of these really appear to apply to me however.
I think I have three options to pay myself:
1. I call myself an employee and generate a W-2/1099 or something, which seems strange to do.
2. Add to (Business Section) Miscellaneous Expenses, report the total amount of payments to myself. Then head to the (Personal Section) and report Miscellaneous Income in the “Less Common Income” section.
3. I don't report the payments to myself anywhere, and just leave the business income reported as it is without any expenses to myself recorded in TurboTax. This seems strange to not report that I'm taking a withdrawal of $XX,XXX for example however.
I've noticed when I try option 3 in TurboTax my taxes are over double option 2.
If anyone has any advice that would mean a great deal to me, as I'm trying to report things correctly.
