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Ask HN: Payroll Tax Hacks

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Ask HN: Payroll Tax Hacks

#1

Post by loschorts »

Hi there, does anyone out there have payroll tax hacks? C-Corp with only 3 founders, no other employees, and a small amount of money invested (less than $100k). We want to pay ourselves, and that's about it.

Does anyone have any payroll tax hacks? One (uneducated) thought I had was to not pay salary but use company money to pay for various expenses like dinner at the office. I read somewhere that doing one large payment of salary is cheaper than periodic payments.

Any ideas? Thanks.

Re: Ask HN: Payroll Tax Hacks

#3

Post by staunch »

gallerytungsten wrote: post #2

Hire a payroll service. Find one that guarantees they will do all the filings, on time. You write one check and don't have to do the paperwork.

Quickbooks Online will handle this for ~$30/mo. They transfer the money directly out of your account and handle state/fed taxes, etc. Really easy.

I don't think that's what he's asking about though. I think he's asking if there's any legal strategies to make your money go further when you're both employer and employee.

Re: Ask HN: Payroll Tax Hacks

#5

Post by [deleted] »

staunch wrote: post #3
gallerytungsten wrote: post #2

Hire a payroll service. Find one that guarantees they will do all the filings, on time. You write one check and don't have to do the paperwork.

Quickbooks Online will handle this for ~$30/mo. They transfer the money directly out of your account and handle state/fed taxes, etc. Really easy. I don't think that's what he's asking about though. I think he's asking if there's any legal strategies to make your money go further when you're both employer and employee.

[deleted]

Re: Ask HN: Payroll Tax Hacks

#6

Post by loschorts »

staunch wrote: post #3
gallerytungsten wrote: post #2

Hire a payroll service. Find one that guarantees they will do all the filings, on time. You write one check and don't have to do the paperwork.

Quickbooks Online will handle this for ~$30/mo. They transfer the money directly out of your account and handle state/fed taxes, etc. Really easy. I don't think that's what he's asking about though. I think he's asking if there's any legal strategies to make your money go further when you're both employer and employee.

Yes exactly, thanks! Nevertheless, it is useful to hear where to save money in any part of the process.

Re: Ask HN: Payroll Tax Hacks

#9

Post by maxbrown »

IANAL or a finance guy so forgive me for not knowing the specifics of this, but can't you issue dividends that are taxed significantly lower than payroll which requires income tax? Or is this only capital gains?

Re: Ask HN: Payroll Tax Hacks

#10

Post by captk »

solsenNet wrote: post #4

most companies this size pay the 3 individuals on 1099, ie independent consultants. no payroll tax on 1099 (at the company level)

Be careful, the IRS is on the lookout for misclassification of employees as independent contractors. It wouldn't be too hard to figure out either, since the majority of your income would be coming from a single "client" on your tax returns, and that amount would match the totals for the company. Make sure you read and understand the rules or you could end up liable for penalties and back taxes.

http://www.irs.gov/businesses/small/article/0,,id=99921,00.h...

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