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Are W-2 wages paid to partners of a partnership considered guaranteed payments? Guaranteed payments are subject to self employment tax and it does not make sense to me that wages on which all payroll taxes have been paid, are still subject to self employment tax.


The BIDaWIZ Team's Answer:

It appears as though you've confused a few things with partnership accounting. Partners in a partnership receive a K-1 as they are not employees of the company. The K-1 details their guaranteed payments which is subject to self employment tax. If you've issued W-2 forms to partners and already took out payroll taxes then it doesn't appear as though you are accounting for it correctly.

The BIDaWIZ Team



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