topic 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. in Business & farm

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.

butchik — Mon, 28 Dec 2020 13:18:56 GMT

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?

Re: 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.

Anonymous_ — Mon, 28 Dec 2020 16:03:48 GMT

Duplicate.

See I'm self-employed, SEP max limit is 25% of net ear... (intuit.com)

Re: 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.

dmertz — Mon, 28 Dec 2020 18:51:45 GMT

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.