I keep doing my research and only end up with more questions. I'm looking for either answers or helpful links about setting up an S Corp Officer on payroll. We're an LLC that just elected S Corp status this year. In previous years, the owner would receive checks every other week, but not through payroll. In my research I've just found out that the working owner of an S Corp has to be on the payroll, making reasonable wages. I got a little help on figuring out how to do the owner's final paycheck this year so that his checks throughout the year will count as salary and the FICA will be taken out of his final paycheck. (1) Do I set up the S Corp Officer (owner/employee) the same way as any employee on payroll?
Then there's the health insurance and retirement that I can't figure out or quite understand. I've read that S Corp officers have a certain health benefit for 2% shareholders if the corporation offers the same health insurance to their employees. I'm wondering (2) if this is a specific kind of insurance or if our current group health plan will qualify, since the owner already uses the same health insurance as the employees? And (3) if we can use our current plan, how do I categorize the premiums that the business pays for throughout the year? And (4) how do I account for the premiums on the owner's final paycheck?
And since there's a special health insurance benefit I was wondering about the owner's retirement. (5) Does this need to be recorded on the paychecks and how? It's usually just categorized as an owner's draw.
If there are any other rules or changes for electing S Corp that I'm missing please let me know or provide any links that would be helpful. Thanks for helping!
