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Answered in 1 hour by:
4/18/2015
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 63,616
Experience: Taxes, Immigration, Labor Relations
VerifiedHi and welcome to our site!
1.Is there any documents to submit even if a disregarded entity?
A.
a Limited Liability Company (LLC) is an unincorporated business structure allowed by state statute.
Depending on elections made by the LLC and the number of members, the IRS will treat an LLC as either a corporation, partnership, or as part of the LLC’s owner’s tax return (a “disregarded entity”).
So far - as long as not specific election was made for that wholly-owned (single-member) LLC - it is a “disregarded entity”
Disregarded - means - ignored for income tax purposes - and all income and expenses are reported on owner's tax return - in your case - because you are a resident alien - that is form 1040NR.
However - only income from US sources is reported - if there is NO income from US sources - you are not required to file and there is no tax liability.
If you specifically select the LLC to be treated as a corporation - filing woudl be different.
That is on the federal level.
In Delaware the LLC is required to pay an annual Alternative Entity Tax. Notices are sent to registered agents in December.
2. what would show up on a loan or other application using this EIN number
A.
When you are asked for the tax ID for income tax purposes - generally you must provide your ITIN - in additional to EIN.
For other - not income tax purposes EIN is sufficient. For instance - if you apply for the loan, to open a bank account, to purchase a real estate, etc - you may use EIN.
For all other purposes - besides income tax - the LLC is separate legal entity.
When requested - you will use form W8BEN for income tax purposes and form - W8BEN-E for all other purposes.
Regarding the loan - unless there is a collateral - the creditor woudl usually ask for personal guarantee when the loan is given to a business entity - so your name would appear on the loan in this case.
Let me know if you need any help.
1.Is there any documents to submit even if a disregarded entity?
A.
a Limited Liability Company (LLC) is an unincorporated business structure allowed by state statute.
Depending on elections made by the LLC and the number of members, the IRS will treat an LLC as either a corporation, partnership, or as part of the LLC’s owner’s tax return (a “disregarded entity”).
So far - as long as not specific election was made for that wholly-owned (single-member) LLC - it is a “disregarded entity”
Disregarded - means - ignored for income tax purposes - and all income and expenses are reported on owner's tax return - in your case - because you are a resident alien - that is form 1040NR.
However - only income from US sources is reported - if there is NO income from US sources - you are not required to file and there is no tax liability.
If you specifically select the LLC to be treated as a corporation - filing woudl be different.
That is on the federal level.
In Delaware the LLC is required to pay an annual Alternative Entity Tax. Notices are sent to registered agents in December.
2. what would show up on a loan or other application using this EIN number
A.
When you are asked for the tax ID for income tax purposes - generally you must provide your ITIN - in additional to EIN.
For other - not income tax purposes EIN is sufficient. For instance - if you apply for the loan, to open a bank account, to purchase a real estate, etc - you may use EIN.
For all other purposes - besides income tax - the LLC is separate legal entity.
When requested - you will use form W8BEN for income tax purposes and form - W8BEN-E for all other purposes.
Regarding the loan - unless there is a collateral - the creditor woudl usually ask for personal guarantee when the loan is given to a business entity - so your name would appear on the loan in this case.
Let me know if you need any help.
Hi,
If that is a single member LLC and treated as disregarded entity - all income and expenses are reported on owner's tax return.
If you apply for the business loan - you will need to produce two years of tax returns.
So - I am not clear what tax returns are you going to provide.
If these are your personal returns - you should have personal ITIN.
Also - business lenders will require personal guarantee. As you are a nonresident alien - your personal guarantee might be not accepted - and you might want to look for someone in the US to partner.
Institutional lenders are very strict of loan requirements.
Specifically for SBA loans - see requirements here
https://www.sba.gov/content/business-loan-checklist
Most lenders will have similar requirements.
If that is a single member LLC and treated as disregarded entity - all income and expenses are reported on owner's tax return.
If you apply for the business loan - you will need to produce two years of tax returns.
So - I am not clear what tax returns are you going to provide.
If these are your personal returns - you should have personal ITIN.
Also - business lenders will require personal guarantee. As you are a nonresident alien - your personal guarantee might be not accepted - and you might want to look for someone in the US to partner.
Institutional lenders are very strict of loan requirements.
Specifically for SBA loans - see requirements here
https://www.sba.gov/content/business-loan-checklist
Most lenders will have similar requirements.
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 63,616
Experience: Taxes, Immigration, Labor Relations
VerifiedLev and 87 other Tax Specialists are ready to help you
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