As a sole proprietor LLC,

[Dtaxman]

I need to show my wages as the owner, but they are a draw from the company as a sole proprietor how do I figure an average and do I add that to Line 26 with all of my other wages? Also do I give myself a 1099?

Well I get notified when answers come in?
I am a newbie

[VolvoGirl]

What kind of LLC?  Are you a Single Member LLC?  Did you elect to be an S corp?  If you are you need to file a separate Business return, not a schedule C.

You don't enter your pay on schedule C or into your tax return at all.

You cannot deduct your own salary or any personal withdrawals you make from your business. As a sole proprietor, you are not an employee of the business.

Sole proprietors cannot take a withdrawal or salary and include it as an expense on their tax return. As a sole proprietor, you are not an employee of the business. You don't pay yourself or enter a salary or withdrawal for yourself. All the business income and expenses are your personal income and expenses in the first place. You just fill out a Schedule C. The net profit or loss is your income.  If you have a net profit of $400 or more on schedule C you will pay SE self employment tax on it in addition to your regular income tax. It's all included on your personal 1040 form.  

(And if you paid yourself and deducted it as an expense then you would have to include it as income on the same tax return so it would be a wash.)

See Schedule C instructions page C-10 right above line 30, Do not include….amounts paid to yourself

http://www.irs.gov/pub/irs-pdf/i1040sc.pdf

[Dtaxman]

I did not elect to be a s corp.  I started the co as an LLC with a sole owner, and filing as a sole proprietor.   does that make sense, because I am still trying to figure our the difference 

my only goal here is to apply for the PPP loan program and need to show my employees.  they have been with me for 19 years.  I should have changed their status and payment method  years ago.  but I did't  - so here we are. 

for now I just need to know this I guess.

"can a 1099 employee be used in figuring payroll wages for the PPP loan application?"

you answer was great !!  thank you so much.  the Schedule C almost killed me.  my degrees are in AIA and Structural Design, I now feel humbled.  I have never filed that before, I lost my Cpa last year and have learned respect for her profession - as well as a collection of new words. 

as an LLC (ll company) as single owner, I am filing as a sole proprietor  - so I am using the Schedule C - right?  I was told that could be wrong. hmmm.  there's another new word :(

[Dtaxman]

10 years, not 19 years.  wheeew

[Dtaxman]

I found my answer,  not what I was hoping for ( for my employees)  tough, they are on their own !  jk

now I need to look into filing a PPP just myself  (as an LLC (company) sold owner but filing as a sole proprietor - I guess I need to figure out how to 1099 myself.  ?  oh Lord.  

why can't you simply walk into a bar...... and get laid?

why is everything seemingly so difficult. hmmm. back to instructions manual.  there goes 6 hours of my life I will never get back .  there's another word. 

 HERE IS WHAT I JUST FOUND. 

" Last week, the SBA issued guidance concerning the rights of independent contractors with respect to Paycheck Protection Program (PPP) forgivable loans. First, the SBA clarified that employers cannot include compensation paid to independent contractors in calculating their own loan amount. Second, the SBA announced that independent contractors and self-employed individuals will be eligible to apply for a PPP loans starting April 10, 2020.

The SBA has not yet provided any guidance with respect to how to calculate the amount of an independent contractor's PPP loan. SBA guidance also appears to indicate that self-employed individuals, such as service partners, may be eligible for PPP loans even if their partnerships are not. This alert explores both these issues in preparation for the April 10, 2020 application date for independent contractors and self-employed individuals. "

[Dtaxman]

SEE ?  I rest my case.  

as it relates to my already confused inquires, does' t this seem to contradict what I thought I just learned. ?

this is from the PPP instructions for borrowers. 

I have italicized and underlined my points. 

1. What counts as payroll costs? Payroll costs include:

•   Salary, wages, commissions, or tips (capped at $100,000 on an annualized basis for each employee);

•   Employee benefits including costs for vacation, parental, family, medical, or sick leave; allowance for separation or dismissal; payments required for the provisions of group health care benefits including insurance premiums; and payment of any retirement benefit;

•   State and local taxes assessed on compensation; and

•   For a sole proprietor or independent contractor: wages, commissions, income, or net earnings from self-employment, capped at $100,000 on an annualized basis for each employee.

so that last one would be for me, right?  NOT my employees. unlesss they wanted to file for PPP themselves.  is the right?

[VolvoGirl]

Right the last one.  And you just show it by the Net Profit on your Schedule C.  You do not have to give yourself a 1099 or pay yourself wages.  As I said above your personal income is the Net Profit or Loss on the Schedule C.   It says the NET EARNINGS FROM SELF EMPLOYMENT.  

[Dtaxman]

thank you. and you need not YELL AT ME 🙂

you know how, when you "get" something,  you wonder how you didn't "get" it before - being so simple....  ya.  me too 🙂

so let me get this straight.   are you telling me that........

my income is from my schedule C  - not "added to" which is why it is called a profit - loss statement, got it.  - I "draw" from my own bank account, which is my companies' - and my company Is basically me, therefore I am taking money from myself  - as the "sole" proprietor.  got it.

I still have one question for the Schedule C - where do I show my employees' payments,  (1099 ic payments?) do I want yo show them on line 11 or line 26?  

as for PPP.

I am not qualified to apply for this loan program.  I "1099" my (2) employees, therefore I don't have any.  thusly, I can not use their pay, when figuring my payroll report,  (which I disagree with and still don't understand.  if the program is designed to maintain your employees, (so they still have a job, and they do not file for unemployment.)  they does the process, by which they were paid, matter - as long at that pay can be verified?  

In addition, I can't  claim my own pay, as I really don't have any.  

This took two weeks for me to get.  (very hard  to admit knowing that all of you must  have been saying, nNO nOO you take him:)   anyway, I am filling out my 1040 tonight !!   

up for questions anyone? 🙂  

thanks for all of your help - all of you ~