Should i pay wages

If i have a single member llc and i am the owner of the entity and the entity is not profitable. Should i still pay wages and issue a W2 to my self to protect against piercing. Can i just have a due to account on the books for accrued compensation to show that i will eventually get paid by the entity.

Answer

Before I can answer your question, I need to ask you a few:

If the entity is not profitable, how are you funding your paychecks?

Are you borrowing money from a bank or other lender?

Are you lending your own money to the llc and taking back a note?

Are you accruing expenses to outside vendors but not paying them, and instead paying yourself?

If you pay yourself "W2" wages (as opposed to taking a draw from your llc's profits), remember that the llc must withhold payroll taxes, pay its share of payroll taxes, and make quarterly deposits of the same.