LLC And EIN - Step By Step Instructions Anyone?
Hi,
here is my situation. I have real estate property in AZ and TX, but live in CA. I am forming a Nevada LLC for each holding. What I have done so far is:
1. Got business filings to form the LLCs for me (in process now)
2. I understand I need to register the LLCs to do business in the appropriate state.
3. Do I need an EIN?
4. I'll be quitclaiming the properties into the LLCs in January.
5. Is there anything else I need to do?
Also, I have conflicting advice. Do I need to pay the $800 that CA charges as an annual tax on LLCs because I live in CA, or does that not apply since my LLCs are in Nevada and I am not doing business in CA?
Any help gratefully received.
Thanks
Before you go much further, I'd recommend you go to the library and get and read a book or two on corporationns/LLCs, and what you're doing when you do incorporate.
One thing to know is this: Every out of state corp or LLC is NOT required to register in every other state where it might own RE...the prevailing law is that if that outofstate corp is renting that RE, then yes, it should be registered.
That OOS LLC registration requires local agent for service (AFS) and annual fee, so that can get expensive if not needed.
Also remember that LLC is tax passthrough, so EIN, while I'm told IS possible, isn't required by IRS.
No fee would be required in CA if none of your corp activity or holdings are in CA, so tell Sacramento to take a hike and save your money. Just because the shareholder LIVES in CA doesn't give them an obligation to pay CA fees.
EINs are easy, go to www.irs.gov, type "EIN" into search, you can do it online and get a temp # instantly. I've gotten EINs for both of my LLCs. Even if you never use them, they're nice to have handy when you need them, and they help when opening business checking accounts; many banks require them.
MIght want to read up more on the transfer process. I'd recommend using warranty deeds, makes the title look cleaner when it's examined later.
The last poster is correct. When you search EIN on the IRS web site you will find a W-4 form. Download this and read the instructions. It sounds like you have set-up single member LLCs and single member LLCs are "disregarded entities" for tax purposes. You do not need an EIN. There is a section in the W-4 instructions that will specifically address this. However, you might find that dealing with banks and other financial institutions is easier when you have an EIN for your LLC. I set-up an EIN because I got tired of trying to explain to banks that I had a single member LLC and was not required to have an EIN.
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