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Scheduling Owner's Draws

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This article is about Justworks PEO. What product am I using?

The information below refers specifically to how to schedule owner's draws in Justworks. For more information about reporting and taxable income, visit Understanding Owner’s Draws.

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Scheduling Owner’s draws in Justworks is simple. Click Pay, then "Make a payment > Domestic and scroll down to the "Owner’s Draw" option. 

The Owner's Draw payment option in Justworks, showing the label 'Owner's draw' and the description: 'This is a distribution from an owner's equity account. This payment is appropriate for sole proprietors, partners in a partnership, and members of a limited liability company.'
 Select the Owner's Draw option from the Make a Payment menu. This option is available under Domestic payments.

On the next screen, select the pay date — you'll see which day funds will be debited from your company's bank account. You'll also choose whether this payment should have all benefit deductions, only 401(k) deductions, or no deductions applied. Then, select recipients and enter the amount each person should receive.

Only members listed as Unpaid Owners or Paid Owners will appear as eligible recipients, so make sure they're marked correctly in Justworks.

Keep in mind that owner’s draws are not taxed, so the recipients you’ve selected will receive that entire amount, less any deductions you may have applied.

Please note, owner’s draws are included as eligible compensation for paid owners who have a 401(k) through Justworks’ MEP with Empower. If the owner does not want deductions applied to the payment, they'll need to change your deferral amount to $0.00 prior to the payment being scheduled. 

The Owner's Draw payment form showing Delivery Preferences with a pay date of 07/31/2026, Benefit Deductions section with 'Make All Deductions' selected, an Additional Information notes field containing 'July 2026', and a member entry for Judy Hoover with an amount of $5,000.00.
When scheduling an owner's draw, you can set the pay date, choose how benefit deductions (including 401(k)) should be applied, add an optional note for the paystub, and enter the draw amount per owner.

 

Once you review and submit, you'll see a confirmation page. This page will let you know when your company’s bank account will be debited for this payment, as well as the last time you’ll be able to cancel or edit the payment. Admins with Make Payments permissions will also receive an email confirmation of the payment being successfully submitted.

The Owner's Draw confirmation page displaying a 'Success!' message, with key dates showing the payment can be edited by Monday July 27 2026, the account will be debited on Tuesday July 28 2026, and the recipient will receive payment on Friday July 31 2026. Additional panels show debit and edit deadline details, and a Payment Summary showing 1 payee and $5,000.00 total.
After submitting an owner's draw, the confirmation page shows your scheduled payment dates, the deadline to edit or cancel, and a payment summary. Note the cutoff time of 2:00 PM ET on the business day before the debit date to make any changes.

 

Disclaimer

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.

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