S Corp Owner W-2 Requirements

S Corp owners who work in the business must receive W-2s: W-2 Requirement: Owner-Employee Status: S Corp owners who perform services are considered employees. More than 2% Shareholder: Special rules apply for shareholders owning more than 2% of stock. Mandatory W-2: Must issue W-2 if any wages paid during the year. What to Include on W-2: Regular Wages: All compensation subject to payroll taxes. Health Insurance: Premiums paid by S Corp for >2% shareholders (included in wages but exempt from FICA). Other Benefits: Group term life insurance over $50,000, other taxable fringe benefits. Payroll Tax Obligations: FICA Taxes: Social Security and Medicare taxes on wages. Federal/State Withholding: Income tax withholding as appropriate. Unemployment Taxes: FUTA and state unemployment taxes may apply. Quarterly Requirements: Form 941: Quarterly payroll tax returns. Payroll Deposits: Timely deposit of withheld taxes. No Wages Paid: Zero W-2: Still may need to issue W-2 showing zero wages. Documentation: Maintain records showing why no wages were paid. Best Practices: Establish reasonable compensation policy. Use payroll service for compliance. Maintain corporate formalities. Issue W-2s by January 31 deadline.