I have 1 employee (self) in a S corp. I have worked many hours in november and december 2006 but just got my payroll service setup this month. I would like to pay the employee an accurate wage for 2006 so it does not look like the S corp made money 2006 and failed to pay any wages. How do you reccomend I proceed with this situation? The payroll service is of no help to get 2006 straightened out.
I don't know if there is a proper/technically correct answer that doesn't incur penalties. ... and then there is your state to deal with. Most situations I've encountered tend to look for some shortcut that just aint kosher. If it is an employee, the 1099MISC approach is NOT correct.
I generally won't touch it unless the taxpayer wants to come clean. ___________________________________
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