How to complete 2020 Form 1120S page 1: Deductions?

Do you need to Complete Form 1125-E Compensation of Officers?

If you are an S corporation and file Form 1120S, you would need to complete Form 1125-E if         you pay compensation to your officers and your total revenues for the year is $500,000 or more.

Check page 1 of Instructions for form 1125-E Total Receipts to determine the income to factor in the calculation of total receipts.

If you are not required to complete Form 1125-E, you don’t need to attach it either to form 1120S.

Line 7: enter the amount paid to officers as salaries or compensations

Line 8: enter the amount paid to your staff members that are not officers

Changes are a partner or shareholder that works in the business would be an officer. Therefore, the salary would be on line 7.

Line 12: Taxes and Licenses: Page 17 or Instructions for form 1120S for detail

Line 13: Interest: Page 17 of 2020 Instructions for form 1120S for more detail.

Line 14 Depreciation. Do nor include Section 179 on this line. It would go on Schedule K and Schedule K-1.

If you placed assets in service in 2020 and would depreciate them, you need to complete Form 4562 Depreciation and Amortization.

The video is an example of how to complete 2020 Form 1120S

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