How Do I Make Myself an Employee of My Company?

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How LLC Owners Pay Themselves

  • Single-Member LLC
    • Pay through an owner’s draw.
  • Multi-Member LLC
    • Pay through distributions according to ownership percentage.
  • Tax Considerations
    • Tax implications and methods may vary.

Paying Yourself as an LLC Owner

  • W-2 Employee
    • Draw a salary via traditional payroll.
  • Profit Distributions
    • Receive profit distributions at lower tax rates.

Tax Implications and Alternatives

  • Handling Taxes
    • Pay income and employment taxes
  • IRS Form W-4
    • File to calculate payroll tax withholdings.

Key Considerations

  • LLC vs. Sole Proprietorship
    • Different tax treatments and payment methods.
  • Partners in an LLC
    • Restrictions on receiving a salary.

Important Note

  • Consult a tax advisor for specific guidance.

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