I have a client that recently converted s corp (solely owned ) to an partnership llc (store manager of 16 years).
This happened 1/18/2018. They had been contributing to a simple ira 3% match. Store manager (who has been taking a payroll check of $65,000/yr) just told me that she is only taking draws, stopped getting a payroll check upon conversion 1/18/18.
She is telling me that company tax preparer has no issue with her not taking a paycheck and that she needs to convert company plan to something that would allow her to make pretax contributions without having to take a paycheck (earned income)? they have not hired someone else to fulfill the responsibilities in the operation.
Any ideas? Can the partners make pretax contributions and company match 3% on draw?
Is there something I'm missing about her moving to partnership status.stopping the $65k/yr earned income via payroll and only receiving a draw of the exact $65k and not having an explanation of who is the workload?
Thanks in advance for any guidance.
