Maximizing Benefits: Adding Your Spouse to Payroll & 401k Contributions

Do you know the right reasons to put your spouse on your company's payroll? Discover the pros and cons as we break down common misconceptions and highlight the crucial factors you need to consider. From recognizing the invaluable contributions of spouses in family-owned businesses to understanding the tax implications of filing a joint tax return, this episode sheds light on both poor and valid reasons for adding your spouse to the payroll. We'll clear up any confusion surrounding Social Security benefits and set the stage for a comprehensive discussion on proper compensation methods, whether through payroll or distributions.
Want to maximize your spouse's 401k contributions while staying on the right side of IRS regulations? Learn the ins and outs of managing an S-corp, especially when it comes to shareholder spouses performing significant services. We explore the tax advantages of adding your spouse to your payroll and delve into the benefits of a solo 401k for businesses with only the owner and their spouse as employees. With detailed scenarios and potential tax-saving strategies for small businesses, this episode underscores the importance of consulting with a tax professional to optimize your benefits. Tune in to understand how to cover FICA taxes, maximize 401k contributions, and achieve financial success with strategic payroll and retirement planning.