Ok first i am in NJ. I am starting a corp.

I will be the owner and act as CEO.

Do i need to report to the state and a "New hiring"


I am under the impression that I the CEO will not need to be on the payroll. I want to avoid requesting a EIN# with the gov untill i am at a posistion to hire a staff. (one year away)


Guidence requested.

thanks

2 different issues here. 1) The CEO title technically is only created when you incorporate, which you will need a FEIN for, 2) if you're not incorporating, then the government gets their money from the self employment tax.

So the answer is "yes" if you incorporate, because the IRS gets angry if you're avoiding paying unemployment medicare, which is what happens when you only pay income tax at year end. BUT, the answer is "no" if you stay as a sole proprietor. You can call yourself CEO or whatever you want, but as an SP the IRS gets their money in the self employment tax.

Hope that helps.

Payroll is only one method for taking money for yourself from your corporation. You probably need to sit with your accountant and discuss some specifics before you decide how much to pay yourself using payroll, and what other methods you'd want to use your cash flow.

True. You can take distributions based on your "stock basis" in the company. But again, you must be incorporated for this to even matter.

I would be happy to go over this with you, if you still have questions.

Thanks for the helpful replys.

I have read tonight that yes i will need a EIN# even though i will not be on payroll. (IRS webpage) I do not plan on adding myself to the payroll until i show profits. It will avoid some taxes and it will keep money in the corp. Since i am the owner and will hold all the shares, my work/time will show in the earnings. But of course there is aways the matter of living money. I will hold my current possition in the NJ work force until my corp can support my living requirments.

What they mean by that is that you need to use a number, like your social security number. If your business will only be part-time part of your income, I would hold off on applying for corporate status. With that comes a lot of filings and headaches. Once you're a corporation, you have franchise tax filings, which in some states have a minimum tax of $350.

Obviously, it's your company so you can do what you choose with it. I just want to make sure your completely informed of the options and results available to you.

Good luck.

Hello folks,
I am so sorry to tell you Surreal that I have nothing to say in this matter. I am in the same boat like you. I only want to thank Joshua for his willingness to help everybody. two thumbs up Joshua and may God bless you Brother.