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How do I transition from a sole proprietor to an LLC (single

Sent to Finance Experts November 9 2008 at 11:50 AM
   

How do I transition from a sole proprietor to an LLC (single owner - taxed as sole proprietor) mid-calendar year in regard to my quickbooks accounting and my Schedule C tax return. Please explain transition for both.

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Answer
November 9 2008 at 12:38 PM (47 minutes and 16 seconds later)
         
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As the tax treatment is the same - there should not be any difference neither in quickbooks accounting nor on Schedule C reporting.

All business income and expenses would be reported the same way and should met same qualifications.

 

On the schedule C - in the header - you may need to mention be LLC name on the line "C" and report LLC tax ID in the box "D"

You do not need a separate schedule C for periods before and after LLC - as there is no difference in the tax structure.

You may attach a note to the schedule C with the dale LLC was created, but as the tax treatment is the same - the IRS would not question that.

 

There should not be any other differences.

 



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