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BK-CPA
BK-CPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 799
Experience:  Owner of a CPA firm
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Not sure how to phrase this question but I receive a salary

Customer Question

Not sure how to phrase this question but I receive a salary plus additional funds due to a "partners" plan via a 1099. The money is paid on a lump sum every september/October of every year. For a tax advantage, My question would be could I establish a LLC and have my employer pay the "LLC" is this even possible?
Submitted: 3 years ago.
Category: Tax
Expert:  BK-CPA replied 3 years ago.

BK-CPA :

Hello and thank you for your question.

BK-CPA :

The overall setup is possible and may even make sense for certain businesses, but generally the LLC is electing to be taxed as a corporation or there is something more to it.

BK-CPA :

Let's start by clarifying what an LLC is. Limited liability companies are created by the states and their statutes. The federal government and the tax law treat LLC's as disregarded entities for most all practical purposes.

BK-CPA :

Forming an LLC in your case would not change a thing for you with respect to your federal taxes. You would still have Schedule C income or perhaps a guaranteed payment from your partnership.

BK-CPA :

On the other hand, New York will charge you more taxes and fees.

BK-CPA :

Unless you have some non-tax reason, such as liability for legal purposes, you probably would not want to form an LLC.

BK-CPA :

If there is something more, again, feel free to clarify, but otherwise I think I'll leave my answer at the above. I do appreciate your question. Thank you again!

Expert:  BK-CPA replied 3 years ago.
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Customer: replied 3 years ago.
Relist: Other.
Not sure CPA has a full grasp of the question posed given the scenerio given. Perhaps I need to provide more details which I was trying during the chat line but CPA cur me off...
Expert:  BK-CPA replied 3 years ago.
You can still provide more details. What is the purpose of forming an LLC for example?... there isn't going to be a tax advantage quite likely as explained above.

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