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jgordosea
jgordosea, Enrolled Agent
Category: Tax
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Experience:  I've prepared all types of taxes since 1987.
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I have formed an LLC in NY State. Where do I find what federal

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I have formed an LLC in NY State. Where do I find what federal and state taxes I have to pay on my money earned from sales. If I do not make ANY sales do I have to even pay taxes?

Greetings,

 

An LLC is a creation of state law so for federal purposes there are several possibilities how it will be taxed.

 

If it is a single member LLC it is disregarded unless you choose to be (and act to elect to be) taxed as a corporation.

 

If it is a multimember LLC it is by default taxed as a partnership but you can choose to be (and act to elect to be) taxed as a corporation.

 

If you do choose to be taxed as a corporation then you also can choose for that corporation to be elect S corporation status for pass through to the members.

 

What federal and state taxes have to be paid on money earned from sales will depend on whether the LLC is disregarded and just added to your individual return or taxed as a partnership or chosen to be taxed as a corporation.

 

See http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Limited-Liability-Company-(LLC) and links for more on elections

 

Indeed if there is no revenue from sales there is no income tax due.

 

There are annual fees and statements to the state for the LLC maintenance.

For more information see http://www.smallbiz.com/static/incorporator/state_requirements.cfm?stateabbr=NY&CFID=5560202&CFTOKEN=47956549

 

Whether or not other state taxes apply depends on the activity of the entity (alcohol, tobacco, fuel, etc have excise taxes for example)

See http://www.tax.ny.gov/bus/multi/other.htm

 

Please ask if you need clarification.

Thank you.

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