Do I need payroll if it’s just me (no employees)?
Short Answer: It depends on your entity type — S-Corp owners generally need payroll; sole proprietors/LLCs typically do not.
If you’re an S-Corp owner, the IRS expects you to pay yourself a reasonable salary through payroll. If you’re a sole proprietor or standard LLC, you typically pay yourself via owner draws.
Common mistakes:
• Taking S-Corp distributions without salary
• Paying yourself “randomly” without planning for taxes
• Not budgeting for payroll taxes
What we recommend: Confirm your entity type and set up the right pay method early..
Still have questions?
If you’re not sure what applies to your situation, we can help.