How do I use TurboTax to handle my S-Corp?

Forum|Forum|3 years ago
January 2, 2023
3 replies
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I have an S-Corp, and in the past years, I only used Home and Business to file taxes.

Can someone help me understand the process in which I should go through to handle S-Corp?

My understanding is to

use TurboTax Business (not Home and Business) to file S-corp. Handle all expenses, salary and distribution.

I will get K1 and 1099?

then use Home and Business to file everything?

Any help is appreciated

TurboTax Business Windows

Best answer by Anonymous_

You really should seek guidance from a local tax professional, but the salary would be reported on a W-2 and the K-1 would reflect the ordinary business income (distributions are different, and you need to learn the difference).

First of all, a 50/50 split for salary/distribution may (or may not) be appropriate based upon the nature of your business. For example, if your business provides a service (e.g., real estate brokerage, consulting), a reasonable salary could entail a higher percentage taken as a salary.

Also, the nonpayment of quarterly tax is an issue but so is the fact that you did not pay yourself a salary in the 2022 tax year.

Again, you really need guidance from a local professional if this is your first year operating as an S corporation.

Anonymous_

Employee

Your (very) basic understanding is correct.

However, there could be other issues, such as whether or not your S corporation paid you a reasonable salary for any services you provided to the corporation and, if so, whether or not you filed the proper quarterly tax forms.

If your S corporation return is relatively simple, you can most likely prepare and file the return yourself with TurboTax Business. If it is more complex, you should seek guidance from a tax professional.

carlhuaAuthor

I did not pay quarterly taxes which means that I will pay the penalty, the amount is not big.

I plan to do 50% salary and 50% distribution.

My understanding is that the salary would be paid out via a W2 (generated by TurboTax) and the distribution via a K1.

However, since when using W2- the employer (the S-corp) needs to pay half of the employment tax. where do I do that? or is this too late? Do I need a software to do this? Your advice is highly appreciated

Anonymous_Answer

Employee

Also, the nonpayment of quarterly tax is an issue but so is the fact that you did not pay yourself a salary in the 2022 tax year.

Again, you really need guidance from a local professional if this is your first year operating as an S corporation.

VolvoGirl

Employee

What do you mean then use Home & Business to file everything? You file the S corp from the Business program. You will get a K-1 and/or a W2 from the 1120 S return to manually enter into your personal 1040 return. You don't need Home & Business. You won't be filing Schedule C. And actually you can use any personal Desktop program, even Deluxe. All the Desktop programs have the same forms. You just get more help and guidance in the higher versions.

scott2112

I just started using TurboTax for my s-corp and personal taxes. Just finished creating all my returns, but entered my K-1 manually. Isn't there a way to transfer my K-1 from the Business software to the Personal software? I didn't see that option.