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FishingForAnswers
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@RogelioL  "I appreciate you for reaching out about how to handle irregular paychecks for a business owner while ensuring taxes are taken care of appropriately.

 

Before issuing an owner’s draw, it’s important to first set up an Owner’s Equity account. When creating this account, select Equity or Owner’s Equity as the account type.

 

After establishing the account, proceed to create a regular check instead of going through the payroll system. Make sure to record the transaction in the Owner’s Equity account you created earlier.

 

To ensure accurate tax deductions from the owner’s paycheck and that they're properly reported, it’s advisable to consult with a tax advisor. They can help determine the best way to ensure taxes are calculated and reported correctly.

 

However, if you prefer to process payments through payroll, you can create an unscheduled paycheck and then check in with your accountant to ensure everything is recorded accurately."

 

My brother in Christ, focus.

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