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I am on ssdi and want to start a llc with my stepson. He…

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I am on...

I am on ssdi and want to start a llc with my stepson. He will be the owner and I will only be an investor with only a passive role. Could my s sdi be affected?

Accountant's Assistant: What state are you in? It matters because laws vary by location.

Florida.

Accountant's Assistant: What steps have you taken so far?

Filed the LLC with the state and the FEIN with his social security number.

Accountant's Assistant: Anything else you want the lawyer to know before I connect you?

Can I use my home address as the business address being property tax except for 100 percent disabled vet?

Submitted: 2 months ago.Category: Tax
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Answered in 4 minutes by:
5/27/2018
Tax Professional: emc011075, Tax adviser replied 2 months ago
emc011075
emc011075, Tax adviser
Category: Tax
Satisfied Customers: 3,977
Experience: IRS licensed Enrolled Agent and tax instructor
Verified

Hi. My name is ***** ***** I will be happy to help you.

It depends how you structure your agreement. If you create a LLC with two equal partners, net profit from the partnership will be treated as earned income and will affect your SSDI. If he creates a single member LLC with you listed as investor he will report all income and expenses on his personal return and your SSDI will not be affected.

How do you plan to be compensated for your investment?

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Customer reply replied 2 months ago
With 20 percent of monthly net then 1000 month
Customer reply replied 2 months ago
Can you guys create a business agreememt?
Customer reply replied 2 months ago
No phone call yet please
Customer reply replied 2 months ago
Hello?
Tax Professional: emc011075, Tax adviser replied 2 months ago

No, I do not do business agreements. So let me opt out and let somebody else pick up the question.

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Customer reply replied 2 months ago
Anyone there?
Tax Professional: taxmanrog, Certified Public Accountant (CPA) replied 2 months ago
taxmanrog
taxmanrog, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1,211
Experience: Licensed CPA, MA, MST with 31 years' experience. Teach Accounting and Tax courses at Masters level.
Verified

Hi! Different expert here. I've been working in taxation for over 33 years, and have faced this issue before.

This is not an issue that requires legal agreements. The organization document simply needs to state that you are a passive, limited partner, and that your stepson is the general partner. It is treated as a limited partnership, and you have a passive role, you are a passive investor.

As a passive investor, it should have no affect on your SSDI.

If you want to "bullet proof" this position, have your son file a Form 8832, Entity Election form. You should ask that your LLC be treated as a corporation, specifically an S-corporation. With an S-corporation, distributions are made proportionate to your stock ownership. So your share of income, losses, and distributions are made the same as your stock ownership. If you want 20%, then you should own 20% of the shares.

Investment and ownership of corporations does not affect your ability to collect SSDI. You would be safe.

I hope this answers your question. If you have any more, please feel free to ask and I will be happy to answer.

Thanks! Enjoy the holiday tomorrow.

Roger

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Tax Professional: taxmanrog, Certified Public Accountant (CPA) replied 2 months ago

Hi! I have not heard back from you. Do you have any questions? Please let me know.

Thanks!

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