cmay wrote:
- quote -

You should also consider whether the Lifetime Learning Credit or Tuition
and Fees deduction (for either or both of you) would be a better
benefit, without involving the S-corp at all. These benefits depend in
part on attending an eligible institution for the purpose of *acquiring*
or improving job skills. See Pub 970 for more information.

-Mark Bole

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On Dec 7, 7:56 pm, cmay <c...[at]walshgroup.com> wrote:

- quote -

Not quite. She'll earn social security credits which could be handy
in the future. If your S corp is making more than the social security
cap (102k for this year) then it also might matter. Say your salary
is 250k, but only 102k of it is subject to social security. If you
pay your wife 50k, then in essence 152k of your income is subject to
social security.

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"cmay" <cmay[at]walshgroup.com> wrote
- quote -


Even though she's not a paid employee (yet), be sure you can document her
work for the business. Then I feel the IRS would allow the deduction for
that tranining expense.

Considerations to making her an employee should be made with this new year.
While it's just exchanging money from one pocket to another as you see it,
the ramifications run deeper than that.




- quote -


Yeah, don't do that. Just make her an employee, either this year (2008) or
next (2009). Even just a few dollars, but more than the business pays in
benefits, provide many benefits at no (or very little) tax costs. If you're
already doing payroll, to yourself and/or other employees, then one more
check isn't as big deal. Additional net tax costs should only be FUTA and
SUTA.





--
Paul A. Thomas, CPA
Watkinsville, Georgia

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I run a small S-Corp. My wife helps me with a lot of stuff with the
business, but I don't pay her a salary or 1099 or anything. She has a
full time job but helps me out after hours a little each week. We
have never bothered to have me pay her because it would be like the
right hand paying the left: it all ends up in the same account.

Now, in order to expand the business and chase some additional work,
we are both taking spanish lessons.

Can I deduct the cost of her portion of the lesson fees?

If she on the books as a contract part time employee (1099) would it
make any difference in this matter?

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >