DavidD66
Employee Tax Expert

Business & farm

I would not issue yourself a W-2 at this point.  One way to deal with a situation like would be to issue yourself a 1099-NEC for the amount you transferred from your business account to your personal account.  You will then report that on Schedule C as part of your personal return.  It's not the "correct" to pay yourself, and if you choose to do so, it should be the only time you do it.  But by doing this you will be paying self-employment tax, which will cover the employer's Social Security and Medicare tax you did not pay due to no payroll.  You can also do nothing, as suggested by Mike9241.  Whatever you do, start to pay yourself as an employee in 2023.   

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