LLC tax question relating to self employment?

Tomeka Hameen: Unless you elect to be treated as a corporation, ALL net income of the LLC is taxable income to you that year, whether you took any money out or not.And yes you should be making quarterly estimated payments. The last one is due on January 15, and if you pay enough in then you might slide under the radar for penalties.

Bryant Chaudhry: If you were defaulting to sole proprietor or partnership, then yes, any income is subject to self-employment tax as well as income tax.If you owe more than $1000 in tax, you can be hit with an estimated tax penalty. To reduce the impact of this a) make a payment by 1/15/2009, b) use form 2210 if your income wasn't evenly distributed over the year.While the penalty is 8%, it typically works out to an effective rate of 4%....Show more

Omar Phipps: Yes. And assuming you have not elected to be taxed as a corporation, the money you take throughout they year isn't wages, only owner's draws, so it has no effect on the ! bottom line which is that the net profit of the LLC is subject to both income tax and self employment tax. To avoid penalties make sure you start doing your quarterly payments.

Adan Alipio: The condo homes don't have any more some thing to do with her pastime on the RE agency. She won't be able to use those hours to qualify as a real sources professional. The condo homes gained't qualify as SE income, so no SE taxes are owed if there's a benefit. If there's a loss, it follows common passive loss guidelines. you're conscious that the LLC could document a 1065 go back, certain?

Wilmer Skidmore: The "usual" federal tax treatment for a single member LLC is as if it was self-employment, i.e., the income and expenses goes on Sch-C, self-employment tax figured on Sch-SE, results carried to 1040.States have their own rules. Some like federal, some not.You possibly could have elected to be taxed as a corporation, if you wanted to complicate your life. If you elected to ! be treated as a C-corp., yes, you would have to pay yourself a! wage and fill out a 941....Show more