Home > Taxes > Officer Of Corporation Cannot Issue 1099 To Self
An Officer Of A Corporation Cannot Issue A 1099 To Him–Self
|
Listen to the audio
- To listen to this interview snippet, just click the play button above (twice if necessary).
|
In this audio snippet, you'll hear about:
- If you're the officer of an S Corp, you cannot issue a 1099 to yourself. Hence, you cannot be a contractor to your own corporation.
- If you do work for your corporation you must be a W2 employee
Audio Transcript
Yosef:
I think it's important for shareholders of corporations to realize
something which they've probably never considered. And that is that if
you are an officer of a corporation, you can never issue a 1099 to
yourself. You can't be an independent contractor to your own
corporation. If you do work for your corporation, you must be a W–2
employee.
Travis:
You must be a W–2 employee.
Yosef:
How can you be an independent contractor when you're an officer of that corporation? You're not independent. [laughs]
Travis:
[laughs] Good point.
Yosef:
It's your corporation. It's your animal, it's your entity. If you're
doing work for it then you're doing work for it as an officer, and
that's why you're there. A number of CPAs, amongst ourselves, we joke
about how clients think that they can get away with that. And it's
really wrong.
Travis:
[laughing] OK.
Yosef:
And it's actually counter–intuitive to begin with.
Travis:
Right. When you frame it that way, it doesn't make sense at all.
Yosef:
That's right.
|