dimanche 27 juillet 2014

Need S Corp tax return help

I work freelance in the film industry, and a few years ago took advice to form an single shareholder S Corp (in Florida where I live). I have since done a portion of my jobs using the company (rather than personally going on payroll). For a couple years I had an accountant do my tax returns, but for 2013 had such a small amount of income that I am attempting to do the return myself (using the previous year's return as a template, which was very similar financially).



I am confused as to how the accountant handled my salary and distributions, and how I should do it. Although I transferred most of the money to my personal accounts, he did not list any "compensation to officers" or "salary & wages" on the 1120S. I have read that this is what gives S Corp returns red flags for audits (and yes, I should have considered this when I got the completed return, it's true--lesson learned). He simply deducted expenses from the income and reported the difference on line 21 of the return, "Ordinary business income", which he then transferred to my 1040 return on Schedule 'E' and line 17 of the 1040.



My questions are this: 1) Do my past year returns need to be amended and/or are they an increased risk for audit? 2) How should I proceed this year? If I do take a salary, does the company need to do a W2 or something for me?



Thanks for any advice you have.




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