Is there a difference of tax amount at the end if you pay yourself out of your solo LLC as employee or as ownerdraw?

Hello there, behzad. Let me explain the difference in tax amount if you pay your solo LLC as an employee or as an owner draw. 

That's right, there's an actual difference if you pay yourself as an employee or as ownerdraw. If you're paying your taxes as an employee, you will pay half of your Social Security and Medicare taxes. Also, you'll only need to pay 7.65%. On the other hand, if you're paying through owner's draw, you'll be taxed like a sole proprietor for your percentage of the partnership's income. In addition, rules about the owner's draw in the case of an LLC vary depending upon laws. Hence, you need to go through the laws before considering the owner's draw and taxes on the same in the case of an LLC.

Furthermore, you can discuss this matter with your accountant for more in-depth guidance in handling their taxes. 

You can check this article for more information regarding paying as a sole proprietor business owner: Set up and pay an owner's draw.

If you have additional questions regarding the difference in tax amount in paying as sole LLC in QuickBooks Online, feel free to leave a comment by hitting the reply button.