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The draws of your profits do not determine your taxable income with respect to the LLC - the profit of the LLC determines that
You could theoretically have tax and receive no distribution
So if I reinvest the profit in the business, still I am liable for tax for the profit ?
Yes, that is correct.
Even if profits are reinvested in the business, they still create taxable income to the owners of the LLC
So anything I should take care of at this point while we are drafting the Operating agreement?
It's pretty standard, actually. There's nothing from a tax perspective that you could optimize in the operating agreement
Ok, thank you.
Is there anything else I can assist you with today?