what to do if a Schedule C filer takes wages and receives a W-2

Forum|Forum|4 years ago
October 15, 2021
2 replies
31 views

Schedule C filer paid himself wages all year and received a W-2 from his payroll company. I know this isn't allowed, so what do I do as far as reporting (or not reporting) it goes?

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IRonMaN

Level 15

If it was earlier in the year, I would say amend the W-2 and 941s and file the schedule C correctly. On October 15th I would probably be tempted to say screw it and file the return as is and tell the client to not do that no more.

Slava Ukraini!

Just-Lisa-Now-

Intuit Community Champion

^^^^ this!

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪

BobKamman

Level 15

How do you know he's a Schedule C filer? Is that how he filed in 2019? Is this a new business? Did someone else help him set up an LLC electing to be taxed as an S Corp, and then he forgot what they said about filing an 1120-S?

I miss Paul Harvey, and if you're old enough to understand that reference, we should both probably be retired.

If Congress paid attention to anyone but big contributors, I'd write them suggesting they enact legislation to allow self-employed people to do this. It would solve a lot of collection problems that IRS must deal with now.

L

Linda MAuthor

Level 3

Hi Bob,

Yes, he filed Schedule C last year. I have no clue why he put himself on payroll or why the payroll company allowed it. But if he wants to take a paycheck, I'll have to file for an entity reclassification for him.

Thanks for taking the time to respond. I didn't know who Paul Harvey was until I looked him up. I must be a little younger than you, but probably not that far behind 🙂

BobKamman

Level 15

Paul Harvey had a daily radio newscast, but was also known for a feature called "The Rest of the Story," which featured a surprise ending that was supposed to leave you guessing until all the facts were narrated. There are a lot of questions asked here that make me want to hear "The Rest of the Story."

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