First time business owner, how does estimated tax work and legal repercussion if I withdraw once a year?
by 452, Window Shopper
- Created: January 11, 2013, 12:00 am
- Updated: January 11, 2013, 12:03 am
I've setup an LLC as myself as the sole owner. This is my first year so I'm trying to learn everything. I have a full time job and do freelancing on the side, the LLC is for the freelancing. Because I make enough at my day job to cover everything, I don't plan on withdrawing money from my LLC's bank account until the end of the year (December 31st). Based on my research, even-though the money isn't in my bank account yet, I still would have to pay quarterly estimated taxes on money that comes into the LLC each quarter. I assume I would file the 1040-ES using my SSN and money from my own bank account. If I do it this way, meaning paying estimated taxes from my account before receiving the actual money because its not the end of the year where I plan to withdraw it, can this be used as a way to pierce the corporate veil? I also assume that I don't have to pay quarterly estimated taxes again when I transfer money from my LLC to my bank account since I've already paid the quarterly coming into the LLC. Since the LLC is considered a pass-through entity and profits isn't double taxed?
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