Dear ikoskela-ga;
Thank you for allowing me to answer your interesting question. The
answer you received from your tax advisor appears to be accurate:
?Limited Liability Companies are a relatively new concept in business
structures and taxpayers have many questions regarding how becoming an
LLC affects their tax return. Since the federal government does not
recognize an LLC as a classification for federal tax purposes, such
entities must figure out how they should file their federal returns.?
?For Federal tax purposes, an LLC business entity must file as a
corporation, partnership or sole proprietorship tax return.
Federal tax laws will automatically classify and tax certain LLC
business entities as corporations. These entities are:
A business entity formed under a Federal or State statute or under a
statute of a federally recognized Indian tribe if the statute
describes or refers to the entity as incorporated or as a corporation,
body corporate, or body politic.
An Association under Regulations section 301.7701-3.
A business entity formed under a Federal or State statute if the
statute describes or refers to the entity as a joint stock
association.
A state chartered business entity conducting banking activities if any
of its deposits are insured by the FDIC.
A business entity wholly owned by a state of political subdivision
thereof, or a business entity wholly owned by a foreign government or
other entity described in Regulations section 1.892.2-T.
A business entity taxable as a corporation under a provision of the
code other than section 7701(a)(3).
Certain foreign entities (see Form 8832 instructions).
An Insurance Company.?
BUSINESS KNOW HOW
http://www.businessknowhow.com/startup/llcfaq.htm
?The LLC tax deduction as a classification is not recognized by the
federal government and therefore all entities who term themselves LLC
or limited liabilities companies must figure out how to pay their
federal taxes.
They have three options. They can file returns either as a
corporation, a partnership or sole proprietorship. In fact, the
federal government classifies certain LLCs as corporations and taxes
them likewise.?
EASY TAX DEDUCTIONS
http://www.easy-tax-deductions.com/LLC_tax_deduction.html
??the IRS doesn?t even recognize an LLC as a separate type of
organization. LLC?s get to choose how they are treated for taxation.?
ABOUT CONSULTING
http://consulting.about.com/od/faq/f/f_BizForm1.htm
?Current federal tax law does not recognize an LLC as a business entity.?
FRANCHISE TAX BOARD
http://www.ftb.ca.gov/law/legis/03_04bills/AB1859_020204.pdf
?The IRS will only recognize an LLC under Sec. 501(c)(3) if all.?
DEVELOPING A RESERVE POLICY MAY HELP YOU SURVIVE THE NEXT CRISIS
http://www.goodmanco.com/goodco/NP_AM_05.pdf
I hope you find that my answer exceeds your expectations. If you have
any questions about my research please post a clarification request
prior to rating the answer. Otherwise I welcome your rating and your
final comments and I look forward to working with you again in the
near future. Thank you for bringing your question to us.
Best regards;
Tutuzdad-ga ? Google Answers Researcher
INFORMATION SOURCES
Defined above
SEARCH STRATEGY
SEARCH ENGINE USED:
Google ://www.google.com
SEARCH TERMS USED:
LLC
GOVERNMENT
FEDERAL
IRS
RECOGNIZE
ENTITY
TAX
CODE |
