Sm plumb biz payroll — add spouse?
My husband had been working for himself for 5 years. Business is picking up. I, the wife, am now doing reception, banking, etc. How beneficial would it be for us to start a payroll on me? I am the only one that he works with. Thanks a million.
Terry Says
I can give you a few good reasons why he should put you on the payroll:
1. You will earn Social Security credits, and will be able to get SS AND Medicare when you retire! (Yes, he will have to pay into SS for you, and that’s a cost.)
2. You can get a great health insurance plan. There is a special enrollment period for small businesses that have at least two employees — although only one has to take the insurance. (His would cover you) Here’s a link to a recent column which explains it but you must be on the payroll for at least most of the previous year.
3. If you have income, you can open a ROTH IRA — a retirement account in your own name. And that’s a good thing to have!
Since you are actually doing the work, you should get paid. It will be a deduction for the business, but you will owe income taxes on the money you receive. Double check with your accountant, but for the reasons above you should receive a paycheck!
