Jim-from-Ohio
Level 11
Level 11

This is what I would do.. i know some may handle it differnetly.   First establish reasonable compensation for the year.. say for example.. $ 125,000.. that is maybe about the amount of gross wages to clear the amount already taken, $95,000.  With a september date I would in my payroll program run a gross check for $ 125,000, deduct $ 95,000 as credit to S Corp Distributions, and take out the rest of the available check so the net check then is zero.  

For the rest of the year now.. if $ 125,000 was a reasonable compensation you could treat the remaining funds that they need personally as S Corp distributions or if the owner wants to pay more into Social Security/or if $ 125,000 is too low for reasonable test they can run more payroll in quarter 4. 

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