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Level 2
posted Dec 26, 2022 9:07:44 AM

Hi, I have an S corp that I am the owner employee. Unfortunately i lost all my clients and don't have income coming to company. Can I stop payroll for me?

So far I have been doing payroll using gusto. Now since there is no income coming to my business, can i just stop payroll? do i need to inform state and federal govt about this?

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1 Best answer
Level 15
Dec 26, 2022 9:36:50 AM

In the case where there is no income, a salary does not have to be paid, but you do not need to notify the state or federal government that you are not paying yourself a salary.

4 Replies
Level 15
Dec 26, 2022 9:36:50 AM

In the case where there is no income, a salary does not have to be paid, but you do not need to notify the state or federal government that you are not paying yourself a salary.

Level 2
Dec 26, 2022 9:48:10 AM

Thank you. Just to clarify I do not have to inform state or fed about no salary that I am earning.  So no paperwork or process to go through this event

Level 15
Dec 26, 2022 9:50:56 AM

if your state charges substantial fees for having the corp - franchise taxes or similar taxes or fees and you don't think the company will be revived, perhaps liquidate it to save on the fees and the cost of filing a return. You would need to file papers with the state and IRS but in some states the annual cost for an S-Corp is over $800 in others it's $40. 

Level 2
Dec 26, 2022 10:54:02 AM

thank you ! appreciate it