I understand the advantages of having an LLC -I 'm referring to a single member LLC-for example I heard when you file taxes your being treated as a sole proprietor and there's more of a chance of you getting audited.
i'm an Enrolled Agent, enrolled to practice before the Internal Revenue Service and just wanted to clarify something from a couple posts up, an LLC can give you pass through income-provided you don't check the box for corporate tax treatment. however, pass through (partnership) status does NOT mean you are not obligated to file any other returns other than your 1040. you will still need to have partnership (or corporate if chosen) informational returns prepared and filed on behalf of the LLC(p) which indicate the different items of income/expense "passing through" to each member.
those items of income and expense show up on your own personal tax return in a completely different schedule than traditional"sole proprietor" income and expense. Sch E vs. C.
i would, and have as member of multiple LLC's, absolutely no concerns about being audited or concerns about extra chances for audits based on Single or Multiple member LLC's.
if you have concerns about that stuff, or those concerns make you hesitate to choose that status, do yourself a favor and hire a professional income tax preparer. preferably an enrolled agent who is specifically trained to help you in choosing the right entity, will discuss the financial impact your choice has on your return, self-employment tax issues etc.
Yes, but joeyd's 1 member LLC is a disregarded entity that doesn't have to file an informational return.
For asset protection purposes, a multi-member LLC is preferable to a single member LLC. There is not much case law on this topic for single member LLCs though.
state statutes concerning llc's are not fully developed yet. some don't recognize single member llc/p's etc. if your state allows it then you will most likely end up just filing a sch c for your llc income/expenses.
the nature of your work as member determines whether self-employment taxes apply. whether you report your income on the C or E if you end up net positive you will have to pay. if you are not sure whether it applies to you or not, you really would benefit from having your own tax person look it over for you.
Can a sole proprietor recieve a LLC License in New York?
I need information on the statues for sole proprietor in New York and New Jersey . Can some one suggest a site with a user-friendly directory? ( I'm a newbie).
I understand the advantages of having an LLC -I 'm referring to a single member LLC-for example I heard when you file taxes your being treated as a sole proprietor and there's more of a chance of you getting audited.
No, you are not more likely to be audited just because you set-up and use a single member LLC.
[addsig]
i'm an Enrolled Agent, enrolled to practice before the Internal Revenue Service and just wanted to clarify something from a couple posts up, an LLC can give you pass through income-provided you don't check the box for corporate tax treatment. however, pass through (partnership) status does NOT mean you are not obligated to file any other returns other than your 1040. you will still need to have partnership (or corporate if chosen) informational returns prepared and filed on behalf of the LLC(p) which indicate the different items of income/expense "passing through" to each member.
those items of income and expense show up on your own personal tax return in a completely different schedule than traditional"sole proprietor" income and expense. Sch E vs. C.
i would, and have as member of multiple LLC's, absolutely no concerns about being audited or concerns about extra chances for audits based on Single or Multiple member LLC's.
if you have concerns about that stuff, or those concerns make you hesitate to choose that status, do yourself a favor and hire a professional income tax preparer. preferably an enrolled agent who is specifically trained to help you in choosing the right entity, will discuss the financial impact your choice has on your return, self-employment tax issues etc.
good luck and happy holidays.
Yes, but joeyd's 1 member LLC is a disregarded entity that doesn't have to file an informational return.
For asset protection purposes, a multi-member LLC is preferable to a single member LLC. There is not much case law on this topic for single member LLCs though.
This question is directed towards "Jvandp".
Concerning the self- employment taxes, does a single member LLC has to file it, if the LLC made any profit. Thanks
state statutes concerning llc's are not fully developed yet. some don't recognize single member llc/p's etc. if your state allows it then you will most likely end up just filing a sch c for your llc income/expenses.
the nature of your work as member determines whether self-employment taxes apply. whether you report your income on the C or E if you end up net positive you will have to pay. if you are not sure whether it applies to you or not, you really would benefit from having your own tax person look it over for you.
Can a sole proprietor recieve a LLC License in New York?
I need information on the statues for sole proprietor in New York and New Jersey . Can some one suggest a site with a user-friendly directory? ( I'm a newbie).