Single Member LLC Payroll

If you are a self employed single member LLC, should you pay yourself and withhold payroll taxes?

Yes you should pay yourself if you make a profit. And yes you should pay your taxes both payroll and income taxes. This is simplest way is to make quarterly estimated payments using Form 1040-ES that can be found at www.irs.gov.

However you can avoid paying payroll tax on passive investment activities such as real estate or rents generated from contributed capital. Losses will offset passive income and for real estate professionals it can offset ordinary income.