Level 15

Talk about your business


@jdubndb18 wrote:

I understand the tax side of it (it goes in block 12 of the K-1), just wasn't sure how I should enter in Quickbooks.


There is more to the tax side than what block it reports in.

 

The IRS watches for a salary, and then distributions, if they see it the other way around that can start them asking questions.  The question concerning taking a distribution without a salary is a tax question, the general answer is no do not do that at all.  What I do not know is if there is some precedent in tax rules concerning a company not able to support payroll but still allowing a small distribution.