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Single member LLC has been in business years.
Last year it lost $175k. So far in 2016 it's earned about $175k.
The S corp just was given election for 2016 for S Corp taxation as it was a LLC before
I read online that you can sell an LLC to a S Corp.
For tax reasons is there any reason the sale (since I own both) couldn't be made effective Jan 1 2016 and pay myself a reasonable amount for the sale from S Corp?
Company A is a LLC taxed as a S Corp.
So, to confirm, what are the steps (maybe an internet link explaining) to contribute the 2nd LLC as capital to the 1st?
Does company A need to pay me for the contribution?
When doing taxes in 2017, would I just not file the schedule C for the 2nd company and instead report it's earnings as part of S corp or on another form?
Even if I contribute the LLC to S Corp, I still have to personally file a schedule C for it, right?
I was told that a S corp that owns a single member LLC the LLC is a disregarded entity and is reported on owner's 1040 w/ scedule C
Can you confirm?
I think I got confused because of reading https://www.calt.iastate.edu/article/single-member-llc-can-be-s-corporation-shareholder that said LLC had to be reported on owner's schedule C as a disregarded entity. Can you confirm?
In terms of the "formality" of transfer to S corp is that simply the date that I designate as such in the internal xfer agreement?
And do I need to "sell" the company and receive a payment from S corp for doing such?
Thank you so much for helping clarify. I realize this question has gone longer, and appreciate your help.
Last question, when I file the tax returns in 2017 for this year, I would file the 851 and 1122 for the single member LLC that was a subsidiary of the S Corp as per https://www.irs.gov/pub/irs-pdf/i1120.pdf ?