Accounting & Bookkeeping & Small Business Forum

Guest · Posted: Wed Apr 28, 2004 7:55 am Post subject: LLC tax set up in QB

I am entering my company into QBP & it asked for tax set up with the type I'm using. I don't know what to put. I have an EIN for my LLC, but I am the only employee. What should I set it up as? I'm confused.

Guest · Posted: Thu Apr 29, 2004 6:31 pm Post subject: RE: LLC tax set up in QB

IF YOU ARE AN EMPLOYEE THAT MEANS YOU ARE A CORPORATION. DID YOU NOT FILE THE PAPERWORK WITH YOUR STATE AND THE IRS???

Guest · Posted: Fri Apr 30, 2004 9:43 am Post subject: RE: LLC tax set up in QB

I am an LLC Limited Liability Company. I don't get a paycheck. I take out withdrawals.

Guest · Posted: Sat May 01, 2004 7:12 am Post subject: RE: LLC tax set up in QB

Your original post said you were an employee. If you are an employee youmust pay yourself a reasonable wage. You can not just draw out money as dividends

Guest · Posted: Thu Jun 24, 2004 11:24 am Post subject: RE: LLC tax set up in QB

A single member LLC is treated as a sole proprieter for tax purposes - it all goes to your schedule C. You are a member, not an employee, so you will pay self-employment tax, but no withholding or payroll tax expense.

Guest · Posted: Tue Aug 24, 2004 9:51 pm Post subject: RE: LLC tax set up in QB

In talking with an IRS agent, I discovered that the IRS does not "recognize" LLCs. But my research (via Nolo Press publications about LLC) state that the LLC like corporations are contingent upon the state in which they are organized. According to the information I discovered in my research, the tax classification of LLCs depend--it depends on the tax classifications of the LLC determined or outlined in the LLC operating agreemnt. The tax classification can be partnership or sole proprietorship of the sole member or corporation. It appears a sole member can be a corporation, too.

If an individual or sole member goes through the expense, paperwork, and "trouble" to establish a LLC, why not go ahead and be taxed as a S- or C-corporation? Of course, because I am in California, and am briefly aware of California's situation with LLCs, I smile when I hear someone wants to be a California LLC. See California imposes an annual $800 company tax fee for the sole purpose, rather privilege of doing business in California tax. This tax is prepaid each year and is in addtion to the LLC fee if sales are over $250,000 per year. The LLC fee is in addition to the income tax that is payable. Don't you love it--privilege of doing business in California tax?