I have a few questions about a S-Corp I am filling. Im curious about a few opertional issues and how this will look on my taxes. I would appreciate some input on the subject. Heres the overview:
Single owner s-corp 1000 shares of stock at par value .01 per share i hold all shares
personal funds spent in getting business up and running $900 (This can be repaid to me as loan repayment or reimbursement correct?)
initial investment when opening business bank account $12,500
money spent on equipment $10,000 leaving $2,500 which i would like to keep on account for operational expenses.
net profit at end of one year after payroll to 5 employess not counting myself is 76,600
my payroll is 32,500 leaving $44,100
throught the year in the expansion of more equipment i will have spent $25,000 leaving $19,100.
Out of that I would like to bring the $2,500 i keep in reserve to cover payroll just in case up to 10,000. so another 7,500 out of the 19,100 leaves 11,600. paid as a distribution.. am i on the right track here.... i did not include the repayment of the 900 of personal funds spent in opening the business or that would make the amount for distribution 10,700. I know i could lower my payroll and increase my distribution but dont want any problems with irs and the distribution will increase in the following years. also my initial investment of 12,500 can i take that back as a repayment of loan over 2 years?? Distributions should be done in a timely manner... does it matter if its once a year, month, or week? Im new to this but trying to educated myself quickly. thank you.
Single owner s-corp 1000 shares of stock at par value .01 per share i hold all shares
personal funds spent in getting business up and running $900 (This can be repaid to me as loan repayment or reimbursement correct?)
initial investment when opening business bank account $12,500
money spent on equipment $10,000 leaving $2,500 which i would like to keep on account for operational expenses.
net profit at end of one year after payroll to 5 employess not counting myself is 76,600
my payroll is 32,500 leaving $44,100
throught the year in the expansion of more equipment i will have spent $25,000 leaving $19,100.
Out of that I would like to bring the $2,500 i keep in reserve to cover payroll just in case up to 10,000. so another 7,500 out of the 19,100 leaves 11,600. paid as a distribution.. am i on the right track here.... i did not include the repayment of the 900 of personal funds spent in opening the business or that would make the amount for distribution 10,700. I know i could lower my payroll and increase my distribution but dont want any problems with irs and the distribution will increase in the following years. also my initial investment of 12,500 can i take that back as a repayment of loan over 2 years?? Distributions should be done in a timely manner... does it matter if its once a year, month, or week? Im new to this but trying to educated myself quickly. thank you.
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