Keyword: Limited Liability Company (LLC)
This is archived information that pertains only to the 2003 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.
12.1 Small Business/Self-Employed/Other Business: Entities: Sole Proprietor, Partnership, Limited Liability Company/Partnership (LLC/LLP), Corporation, Subchapter S Corporation
I recently formed a limited liability company (LLC). The LLC has
no employees. Do I need a separate Federal Tax ID number for the LLC?
No, you will not need a separate Federal Tax ID number for the LLC if you
are the sole owner of the LLC and the LLC has no, employees. If you are not
the sole owner of the LLC or if the LLC has employees, you will need a separate
Federal Tax ID number for the LLC.
References:
- Publication 1635 (PDF), Understanding your EIN
- Employer identification Number - IRS
- Form SS-4 (PDF), Application
for Employer Identification Number
- Form 8832 (PDF), Entity Classification
Election
As a Domestic LLC (limited liability company), what forms do I use
to file a return?
The form you use will depend on what kind of entity your business is for
Federal tax purposes. Following are some general guidelines and the forms
which go with each entity:
If your business has only one owner, it will automatically be considered
to be a sole proprietorship (referred to as an entity to be disregarded as
separate from its owner) unless an election is made to be treated as a corporation.
A sole proprietorship files Form 1040 (PDF), U.S.
Individual Income Tax Return and will include Form 1040, Schedule C (PDF), Profit or Loss from Business, or Form 1040, Schedule C-EZ (PDF) and Form 1040, Schedule SE (PDF) , if net income $400.00. If an election is made to
be treated as a corporation, Form 1120 (PDF), U.S.
Corporation Income Tax Return, is filed.
If your business has two or more owners, it will automatically be considered
to be a partnership unless an election is made to be treated as a corporation.
A partnership files Form 1065 (PDF), U.S.
Partnership Return of Income. If an election is made to be treated as
a corporation, Form 1120 (PDF), U.S. Corporation
Income Tax Return, is filed.
The election referred to is made by filing Form 8832 (PDF), Entity Classification Election.
References:
For IRS purposes, how do I classify a limited liability company?
Is it a sole proprietorship, partnership or a corporation?
A limited liability company (LLC) is an entity formed under state law by
filing articles of organization as an LLC. Unlike a partnership, none of the
members of an LLC are personally liable for its debts. An LLC may be classified
for Federal income tax purposes as a sole proprietorship (referred to as an
entity to be disregarded as separate from its owner), partnership or a corporation.
If the LLC has only one owner, it will automatically be considered to be a
sole proprietorship (referred to as an entity to be disregarded as separate
from its owner), unless an election is made to be treated as a corporation.
If the LLC has two or more owners, it will automatically be considered to
be a partnership unless an election is made to be treated as a corporation.
If the LLC does not elect its classification, a default classification of
partnership (multi-member LLC) or sole proprietorship (single member LLC)
will apply. The election referred to is made using the Form 8832 (PDF), Entity Classification ElectionIf a taxpayer does not
file Form 8832 (PDF) , a default classification
will apply.
References:
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