So I essentially profited $10,000 from my S-Corp. I am the sole owner/shareholder. Throughout the year I would just transfer any earnings I had from my business account to my personal account. I am confused on the best way to report my income. I was told an owner's draw is how I should do this but I can't figure out how.
I do not want to report this as a salary because I would have to pay payroll taxes, though I have read that I pretty much guarantee getting audited if I list it all as distributions. I was going to list the 10,000 as distributions and then when the K-1 is generated report that number on my personal taxes in the corresponding section. I
Am I allowed to report the income as self employment income? Or is there a specific way to report it as an owner's draw. I want to avoid paying payroll taxes, is this possible?
