I have been doing an LLC tax
return that has two foreign partners who receivied their tax IDs earlier this year, after two years of back and forthing with IRS.
The LLC has only one type of income, rental real estate income. The annual net income after depreciation is about $210,000 for the partnership. Each partners tax liability for their share, $105,000, is about $20,000.
I just realized that the partnership must file form 8804, 8805 and 8813.
Q1- When I complete form 8804-W, I am assuming the ECTI is $210,000, the quarterly tax liability is $20,790 based on 39.6% tax bracket. Thus the annual tax withholding
for each partner is over $40,000 which is twice that of the tax lialibity on their 1040NR. This doesn't make sence. Does that mean the partnership has withhold $40K on behalf of each partner, and then the partners have to claim the refund on their individual tax return?
Q2- Is it correct to say that the partnership has to file for 8813 on a quarterly basis along with form 8804-W and send the payment to IRS, and then annualy file form 8804 and for 8805?