I own a tile business and is registered as single llc.
I’m not sure if the way I file my taxes is the correct or the best way. I pay myself every month base on hourly rate. I sent my taxes every three month base on those checks. At the end of the year I do my taxes using turbotax and basically I put my gross income, my expenses and my w-2. Is this the way to do it?
As the owner of an LLC taxed as a partnership, you are not a W-2 employee.
As the owner of the LLC, you are taxed on your share (if you are the sole owner, then 100%) of the LLC’s profit.
So, you need to first enter your LLC’s revenues, subtract expenses, and determine your profit.
This is all done on your Schedule C if you are a disregarded entity single member LLC, or on a separate Form 1065 if you are filing as a partnership.
Schedule C is part of your personal 1040, and the instructions for completing it are all there.
Turbo-Tax Home and Business (not Deluxe or Premier) is the one you want to use for your single member LLC.
As a single member LLC, you are not taxed on how much you withdraw from the LLC in “pay”, but on how much profit the LLC reports based on its revenues and expenses.
It is possible, for example, if your LLC has depreciable assets (such as real estate), that you could be cash-flow positive (putting cash into your pockets each month) and yet still have zero or even negative tax liability because of depreciation expenses.