Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (2) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: cslob One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121602  
Subject: S Corp: are owners "self employed" Date: 10/13/2006 1:44 AM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
I am part owner of an S Corporation who is my employer (i.e. a shareholder).

Why does the IRS consider me 'self-employed' ? Just because they do?

The reason I ask is related to our SEP IRA plan ( Under SEP, all employess must get the same percentage contribution, part owner or not.) It complicates accounting and obfuscates the tax situation because the contributions to non-owners are a normal business expense (employee benefit) but contributions to owners are not, and appear as profits of the corp that fall thru to owner's personal taxes where a "Self-employed SEP Deduction" is taken personally. Follow that?

This all comes out tax neutral, but it still shows that the company has made (and still has) money that in fact was spent on a legitimate purpose. In fact we try to spend much of (what would have been) profit into the SEP.

I know, ask my accountant--but you see I've just told you what I think he said--and it doesn't make any sense!

When I go to a bank for a mortgage, they don't think I'm self employed. I have a salary, benefits, seniority, a W2, etc and very little say about how the business is run.

Can anybody shed light on this? Do I have something wrong?
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (2) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

Disclaimer:
In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement