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1 employee/owner S-corp SEP max contribution limit who gets 1099 from customer. How to determine net earnings since the S-corp income goes to personal income tax return.
Can i contribute 25% of total amount in 1099 (i.e. amount in 1099 is basis for "net earnings" or "compensation") or do i need to subtract business expenses from them?
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December 28, 2020
5:18 AM
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Business & farm
December 28, 2020
8:03 AM
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Business & farm
The S-corp shareholder's compensation is the amount reported on the shareholder's W-2 from the S corp. It's what the S corp paid the shareholder in wages or salary.
S corp shareholders receive a W-2, not a Form 1099-NEC or 1099-MISC. S-corp shareholders are employees of the S corp. They are not self-employed.
If this is your first year having an S corp, you should get professional help. Making mistakes with an S corp can be quite costly.
December 28, 2020
10:46 AM
268 Views