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Level 4
posted May 9, 2024 1:07:27 PM

Does C Corp issue K-1?

I have C Corp. I have 1099 to contractors. Does it issue K-1 to owners? 

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3 Replies
Level 15
May 9, 2024 1:14:32 PM

@stech wrote:

I have C Corp. I have 1099 to contractors. Does it issue K-1 to owners? 

No, not C corporations. The only type of corporation that issues a K-1 is an S corporation.

Level 4
May 9, 2024 1:17:18 PM

So owners are paid via draws?

Level 15
May 9, 2024 1:23:51 PM

Shareholders are the owners of C corporations.

 

If they (or others) perform services for the corporation, they are typically compensated with a salary/wage (they're employees of the corporation as such).

 

Otherwise, payments made to shareholders by C corporations are dividends (or return of capital in certain instances).

 

Please don't take this the wrong way but if you do not have a rudimentary knowledge of the foregoing you need to consult with a local tax professional.