mrichman333 Posted March 4, 2014 Report Posted March 4, 2014 If an LLC chose to be classified as a S-Corporation by filling form 2553. Can the single member of the LLC choosing to be taxed as a S-Crop now receive a W-2 from the company. And do they file a 1120S Quote
OldJack Posted March 4, 2014 Report Posted March 4, 2014 In most cases the S-corp must pay an officer on a W2 a fair wage for work performed. Of course an S-corp (LLC) must file a 1120S tax return. 2 Quote
jklcpa Posted March 4, 2014 Report Posted March 4, 2014 Yes, it is possible. The LLC first has to file the Form 8832 Entity Classification to elect to be taxed as a corporation, and then it files the Form 2553. Even a single-member LLC can elect to be taxed as a corporation. Below is an pretty good article that discusses the merits of doing this. Be careful that you don't end up with an undesired result like having appreciated real estate in a corporation though. http://www.bizfilings.com/toolkit/news/tax-info/llc-plus-scorp-equal-best-of-both.aspx 1 Quote
Abby Normal Posted March 4, 2014 Report Posted March 4, 2014 Yes, it is possible. The LLC first has to file the Form 8832 Entity Classification to elect to be taxed as a corporation, and then it files the Form 2553. Even a single-member LLC can elect to be taxed as a corporation. Below is an pretty good article that discusses the merits of doing this. Be careful that you don't end up with an undesired result like having appreciated real estate in a corporation though. http://www.bizfilings.com/toolkit/news/tax-info/llc-plus-scorp-equal-best-of-both.aspx Judy, The IRS changed it quite a few years ago that you only need to file the 2553 and not the 8832. The timing of processing the two forms was causing a lot of headaches. Quote
mrichman333 Posted March 4, 2014 Author Report Posted March 4, 2014 One more question. I am assuming if they elect to be taxed as a S-Corp for federal, they will have to file as a S-corp for state Quote
Lion EA Posted March 4, 2014 Report Posted March 4, 2014 Check your state instructions. (Or, tell us the state.) Quote
jklcpa Posted March 4, 2014 Report Posted March 4, 2014 Judy, The IRS changed it quite a few years ago that you only need to file the 2553 and not the 8832. The timing of processing the two forms was causing a lot of headaches. Thank you Quote
michaelmars Posted March 4, 2014 Report Posted March 4, 2014 now of course they will need to deal with quarterly payroll filings, monthly deposits of taxes etc. And you have to watch the local stuff like here an S corp has to pay NYC corp taxes on top of fed and state. Quote
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