I am in the process of setting up my business. I have completed my Articles
OF Organization to become an LLC in the state of NC. Can anyone tell which
would be the best tax classification between the ones listed above?
If you are the sole owner of the LLC and wished to be taxed as a "disregarded
entity", meaning the LLC does not file its own tax return and your report
income / expense on Sch. C of your individual 1040 (which is the simplest way
to go about it), then you follow the instructions on page 4 of the SS-4
instructions document. You are inquiring about which box to check for
Question 9a on form SS4. For an LLC that is a disregarded entity, check
"other" then write in "disregarded entity" next to other. This direction
comes from page 4 of the instructions.
http://www.irs.gov/pub/irs-pdf/iss4.pdf
If there are more than one owner (member) of the LLC, then it cannot be a
disregarded entity. If you wish not to be taxed at the LLC level, then select
"partnership" in response to Question 9a.
As always check with your tax accountant or attorney for professional
guidance.
How you file as a LLC depends on your situation personally and within the
business. For example, I have been told by my accountant that if I have only
one owner of the LLC, I can only file as if I was a sole proprietorship. This
may be true in Colorado but not in NC. I would recommend talking to your
account to find out what you need to do for your state.
kmurray | Community Moderator |
6/7/2012 - 8:37 am
Hi,
This blog post offers information about LLCs and additional resource links.
You can also try getting in touch with a local Small Business Development Center, which is one of SBA's resource partners. They're located across the country andprovide free business counseling and answers. volunteer there with business experience could offer you advice on what may be best for your situation. Visit SBA Direct to find your local SBA resource partners by entering your zip code.
Best of luck!
jjray | Window Shopper | 6/18/2012 - 1:39 pm
entity", meaning the LLC does not file its own tax return and your report
income / expense on Sch. C of your individual 1040 (which is the simplest way
to go about it), then you follow the instructions on page 4 of the SS-4
instructions document. You are inquiring about which box to check for
Question 9a on form SS4. For an LLC that is a disregarded entity, check
"other" then write in "disregarded entity" next to other. This direction
comes from page 4 of the instructions.
http://www.irs.gov/pub/irs-pdf/iss4.pdf
If there are more than one owner (member) of the LLC, then it cannot be a
disregarded entity. If you wish not to be taxed at the LLC level, then select
"partnership" in response to Question 9a.
As always check with your tax accountant or attorney for professional
guidance.
tmerrill | Window Shopper | 6/8/2012 - 9:01 am
business. For example, I have been told by my accountant that if I have only
one owner of the LLC, I can only file as if I was a sole proprietorship. This
may be true in Colorado but not in NC. I would recommend talking to your
account to find out what you need to do for your state.
kmurray | Community Moderator | 6/7/2012 - 8:37 am
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