MARK KOHLERMain Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, LLC · Owner at Main Street Professionals, LLC

Does Your Spouse Need to Be on Payroll?

13 Oct 2025 · 1 min

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Mark Kohler explains that putting your spouse on payroll won't boost their Social Security much, since spousal benefits are based on your 35-year average earnings. The real benefit is accessing higher 401(k) contribution limits. He recommends a salary around $25,000 to maximize retirement savings while minimizing self-employment taxes.

Chapters

Do I put my spouse on payroll so they can get Social Security and also start paying them? That's not a good thing to do because a spouse is going to get half of their working spouse's Social Security and It's averaged over 35 years of income. So we'd have to start giving you some major salary before you'd ever catch up to the half that you're already entitled to from your working spouse. So I'm just going to get to the reveal here. And that is the only time you want to put your spouse on payroll is so you can put money in his or her 401k. So now we want to find that perfect salary level level for them without doing too much either. And sometimes just the deferral is fine. If it's 23, five, let's put this spouse on payroll for 25 grand, boom, put away more than they could in an IRA. They still can do an IRA. And so we're getting that magic. So the moral of the story is we want to find the perfect salary for you and possibly for your spouse so that we're maximizing both contributions without paying the dreaded self employment tax too much.