Proving your income when self employed

[Mansini77 100]

I gave this topic a search on Google and found a thread on Visa Journey, but it was from 2013.  Not exactly the most informative information either.  So, I'm going to start one off fresh.

 

My spouse's big Consulate interview is coming up in three weeks and I've been preparing as much as possible before her big day.  

 

As a small business owner, I'm required to pay myself a weekly salary so I not only withhold Federal and State taxes, but also SS/Medicaid.  These figures are totaled and printed on my own W2 form.  However, the W2 is only a piece of the total income picture.  Any gross income minus expenses for my business are calculated and whatever is remaining is the net income.  My business is an S-Corp and I am the 100% stockholder of the business.  So, any net income is then reported on a Schedule K-1, which is "Shareholder's Share of Income".  

 

Lets say in 2017: My W2 income is $40,000 and my K-1 income is $65,000.  That total would be $105,000 and would then be used on my personal income tax returns Form 1040.  

 

Here are the documents my wife will bring to the Consulate interview that concern the Affidavit of Support:

 

1) W2s from 2017,2016,2015.

2)Schedule K-1 Share  of income for 2017,2016,2015

3)Our Joint Federal Income Tax returns for 2017,2016,2015

 

These three are solid documents to prove my income, however I'm a bit hesitant on how the Consulate interviewer's opinion of these documents as I don't write myself a paycheck and have no pay stubs. Our immigration attorney said to me "Well, these are all great, but you have no pay stubs and these don't SHOW HOW YOU GET PAID".  Fair enough.

 

Since my bank handles both my business and personal accounts, I asked a banker to print out a monthly bank statement back in December.  I then highlighted the withdrawal from my business checking and highlighted the deposit to my personal checking.  I basically have them transfer money from one account to another without even handling any cash.  Some weeks, I might need just my salary, other weeks, I might withdrawal more depending on what types of personal bills need to be paid (mortgage and health insurance are the largest).  So, I will be giving my wife more evidence:

 

4)Bank statements showing weekly income being deposited into my personal account 

 

While I believe this might be enough to convince the Consulate interviewer, I wanted the opinions of the VJ community, specifically those who are self employed and business owners to give me more suggestions to strengthen our case.  I have my own home and business, but evaluating these assets are tricky and involve getting appraisals done by 3rd parties.  

 

Thank you in advance.

 

 

[Alabamak1 688]

2 hours ago, Mansini77 said:

I gave this topic a search on Google and found a thread on Visa Journey, but it was from 2013.  Not exactly the most informative information either.  So, I'm going to start one off fresh.

 

My spouse's big Consulate interview is coming up in three weeks and I've been preparing as much as possible before her big day.  

 

As a small business owner, I'm required to pay myself a weekly salary so I not only withhold Federal and State taxes, but also SS/Medicaid.  These figures are totaled and printed on my own W2 form.  However, the W2 is only a piece of the total income picture.  Any gross income minus expenses for my business are calculated and whatever is remaining is the net income.  My business is an S-Corp and I am the 100% stockholder of the business.  So, any net income is then reported on a Schedule K-1, which is "Shareholder's Share of Income".  

 

Lets say in 2017: My W2 income is $40,000 and my K-1 income is $65,000.  That total would be $105,000 and would then be used on my personal income tax returns Form 1040.  

 

Here are the documents my wife will bring to the Consulate interview that concern the Affidavit of Support:

 

1) W2s from 2017,2016,2015.

2)Schedule K-1 Share  of income for 2017,2016,2015

3)Our Joint Federal Income Tax returns for 2017,2016,2015

 

These three are solid documents to prove my income, however I'm a bit hesitant on how the Consulate interviewer's opinion of these documents as I don't write myself a paycheck and have no pay stubs. Our immigration attorney said to me "Well, these are all great, but you have no pay stubs and these don't SHOW HOW YOU GET PAID".  Fair enough.

 

Since my bank handles both my business and personal accounts, I asked a banker to print out a monthly bank statement back in December.  I then highlighted the withdrawal from my business checking and highlighted the deposit to my personal checking.  I basically have them transfer money from one account to another without even handling any cash.  Some weeks, I might need just my salary, other weeks, I might withdrawal more depending on what types of personal bills need to be paid (mortgage and health insurance are the largest).  So, I will be giving my wife more evidence:

 

4)Bank statements showing weekly income being deposited into my personal account 

 

While I believe this might be enough to convince the Consulate interviewer, I wanted the opinions of the VJ community, specifically those who are self employed and business owners to give me more suggestions to strengthen our case.  I have my own home and business, but evaluating these assets are tricky and involve getting appraisals done by 3rd parties.  

 

Thank you in advance.

 

 

if your are self employed and paying yourself....how do you put a w-2 together w/o a paycheck and pay into Social security and do all required payments for employees 

[Mansini77 100]

11 minutes ago, Alabamak1 said:

if your are self employed and paying yourself....how do you put a w-2 together w/o a paycheck and pay into Social security and do all required payments for employees 

How I get paid and my employees get paid is not the same.  My salary is reflected on my W2, and I also withhold money for Fed State and SS...its kind of redundant and needless to "write myself a check" when all i have to do is instruct the bank teller what to withdrawl and deposit.  You see, the total amount of the months wages are totaled and everyone, including myself pay 6.2% to SS and 1.45% to Medicaid.  The employer, then has to match everyone's SS/Medicaid contributions.  Example, if the monthly payroll totalled $10,567.31.  Then everyone,  in total paid $808.40.  The employer must match that number and pay $808.40 for a total of $1616.80, including everyone's Federal Withholding which is then deposited to the IRS via EFTPS.  The totals of one quarter (three months) must be then calculated and reported to the IRS by a form f-941.  

 

...and people think being a business owner is easy.  

 

Now that has been cleared up, I hope I receive some input on the original post instead of getting more into tax codes, forms and deposits.

[payxibka 10,045]

Your W-2's and your 1040 will be sufficient as the K-1's are reflected on Schedule E of your 1040

[payxibka 10,045]

23 minutes ago, Alabamak1 said:

if your are self employed and paying yourself....how do you put a w-2 together w/o a paycheck and pay into Social security and do all required payments for employees 

Just like any other employer.  It is not rocket science

[Alabamak1 688]

7 minutes ago, Mansini77 said:

How I get paid and my employees get paid is not the same.  My salary is reflected on my W2, and I also withhold money for Fed State and SS...its kind of redundant and needless to "write myself a check" when all i have to do is instruct the bank teller what to withdrawl and deposit.  You see, the total amount of the months wages are totaled and everyone, including myself pay 6.2% to SS and 1.45% to Medicaid.  The employer, then has to match everyone's SS/Medicaid contributions.  Example, if the monthly payroll totalled $10,567.31.  Then everyone,  in total paid $808.40.  The employer must match that number and pay $808.40 for a total of $1616.80, including everyone's Federal Withholding which is then deposited to the IRS via EFTPS.  The totals of one quarter (three months) must be then calculated and reported to the IRS by a form f-941.  

 

...and people think being a business owner is easy.  

 

Now that has been cleared up, I hope I receive some input on the original post instead of getting more into tax codes, forms and deposits.

 

3 minutes ago, payxibka said:

Just like any other employer.  It is not rocket science

i was trying to make a point that a paystub would be one of the documents you can present as evidence of income.  

Edited April 8, 2018 by Alabamak1

[payxibka 10,045]

5 minutes ago, Alabamak1 said:

 

i was trying to make a point that a paystub would be one of the documents you can present as evidence of income.  

I am sure as the owner of the business he would have no problem taking the information from the pay register and creating a paystub

[Mansini77 100]

24 minutes ago, payxibka said:

Your W-2's and your 1040 will be sufficient as the K-1's are reflected on Schedule E of your 1040

Alrighty.  The S-Corp income is clearly stated on my 1040 line 17 and is supported by the K-1.  

 

I do also have an S-Corp Tax Return, starting with form 1120-S showing the total sales, expenses, depreciation.  It's a pretty lengthy 30 page document, but I could simply highlight the most crucial parts that are transferred onto the K1.

 

On the other hand, I COULD write pay stubs for myself, but it wouldn't look very convincing as they would be handwritten.  I have five employees, so while I keep track of all their wages and withholdings on the PC, checks are hand written.

 

 

[payxibka 10,045]

3 minutes ago, Mansini77 said:

Alrighty.  The S-Corp income is clearly stated on my 1040 line 17 and is supported by the K-1.  

 

I do also have an S-Corp Tax Return, starting with form 1120-S showing the total sales, expenses, depreciation.  It's a pretty lengthy 30 page document, but I could simply highlight the most crucial parts that are transferred onto the K1.

 

On the other hand, I COULD write pay stubs for myself, but it wouldn't look very convincing as they would be handwritten.  I have five employees, so while I keep track of all their wages and withholdings on the PC, checks are hand written.

 

 

S-Corp will only serve to confuse because corporate gross income and expenses are meaningless.  Net to the shareholder is and that is the K-1 which is reflected on the 1040

 

You wouldn't need to handwrite as I am sure you could do it in an excel template

Edited April 8, 2018 by payxibka