For an LLC, S-Corp, partnership, or sole proprietorship, Beyond Payday adds an income source for each owner, named after the business. It holds that owner's share of the business's net profit and updates as the business's numbers change. If the business runs at a loss, the amount is negative and lowers your total income.
How it works
- Net profit is business revenue minus business expenses, including any business share of split bills.
- Owner pay (an income marked Owner Compensation) is never counted as business revenue. For an S-Corp, C-Corp, or partnership (including an LLC with two or more owners), it is a business expense and lowers net profit. For a sole proprietorship or single-owner LLC, the owner can't pay themselves wages: it is a draw, not an expense, and it is subtracted from that owner's share so it isn't counted twice.
- Owner share is net profit times the owner's ownership percentage.
- That share goes on the owner's linked income source on the Income (opens in a new tab) page. It is updated when business income, expenses, or ownership change.
- Taxes are estimated from that income source's type and tax rate, like any other income. Non-W2 income has no withholding: the app estimates income tax from the rate you enter, and adds self-employment tax for Self-Employment income. Edit the income source to change its tax rate.
- C-Corps are skipped. Their profit is taxed at the business, so no pass-through income is created.
An example with real numbers
An LLC has $60,000 in revenue and $80,000 in expenses, so net profit is −$20,000. Two owners at 50% each get −$10,000 a year. Each owner's income card shows Business Loss and Business loss (costs you money) in red instead of gross pay and take-home, and each owner's total income drops by $10,000 a year.
Assumptions and limits
- The tax is an estimate from the rate you set, not a real tax calculation. Beyond Payday doesn't model loss carryforwards or deduction limits.
- A loss is not taxed; it just lowers your income.
- The owner share is based on ownership percentage only. Actual distributions you take out are not tracked separately.
FAQ
Why is my business income negative? The business spent more than it earned, so your share of the loss shows as money you put in. It lowers your total income instead of counting as $0.
Why doesn't my C-Corp create income for me? A C-Corp is taxed on its own, so its profit doesn't pass through. Add any salary it pays you as a regular income source.
Does Beyond Payday calculate my exact business taxes? No. It gives an estimate from the tax rate on the income source. It is not tax advice or a tax filing.
FAQ
Why is my business income negative?
The business spent more than it earned, so your share of the loss shows as money you put in. It lowers your total income instead of counting as $0.
Why doesn't my C-Corp create income for me?
A C-Corp is taxed on its own, so its profit doesn't pass through. Add any salary it pays you as a regular income source.
Does Beyond Payday calculate my exact business taxes?
No. It gives an estimate from the tax rate on the income source. It is not tax advice or a tax filing.