How to Pay Yourself as an LLC: Draws vs. Payroll (and Why Profit Isn't Cash)

How do you actually pay yourself from an LLC? Follow Frank, a tile contractor who took $60,000 out of a business that earned $90,000, and see the difference between profit, what you took, and what's in the account. We cover draws vs. payroll, the profit-versus-cash check, a simple three-account setup, what the tax layer looks like, what happens when a company owes more than it has, and retirement, health insurance and account access. Six questions to bring to your CPA and attorney. Chapters: 0:00 The $30,000 gap 0:56 Frank's year in numbers 1:50 Draw or paycheck 3:26 Four mistakes 5:30 A three-account system 7:00 If you have a partner 8:12 The tax layer 9:31 When the company owes more than it has 10:56 Beyond the paycheck 12:08 Homework This is general information, not legal or tax advice. Your situation has details this video doesn't cover, so have your own documents and numbers reviewed. Disclosure: some AI-generated voice may be used in these videos. Alley Media LLC.