Expert: Ed McFarland - 7/7/2006

Question
I was wondering if I need to have a payroll account if I form a
corporation when I am the only employee and owner. Do I apply
for federal and state ID number when my corporation has
started to make any money and started to give paycheck to
mysel or from the begining or the corporation formation. And is
it possible to just give myself a 1099 for the money I take from
the corporation?

Answer
You don't need a payroll account for a single person operation.

Good record keeping is critical. In the early going you can just take out what you need. Get good advisors for accounting and legal advice for organizing the business.

In the beginning, you'll be able to use a Schedule C of your personal 1040 to report the business and any income to the IRS.

Good luck