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Trump Tax Plan

1,500 Views | 6 Replies | Last: 6 yr ago by Ulrich
TheAggieInventor
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For someone who has recently started a new business, and who will have their first revenue coming at the turn of the new year, what do I need to know as a new small business on how to file taxes as an LLC and what Trumps tax plan means differently for my business compared to what is currently in place?

Thank you.
The Wonderer
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AG
how is your LLC taxed?
oldarmy1
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AG
The Wonderer said:

how is your LLC taxed?
In other words how did you elect to have your LLC recognized?

Classifications
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"). Specifically, a domestic LLC with at least two members is classified as a partnership for federal income tax purposes unless it files Form 8832 and affirmatively elects to be treated as a corporation. And an LLC with only one member is treated as an entity disregarded as separate from its owner for income tax purposes (but as a separate entity for purposes of employment tax and certain excise taxes), unless it files Form 8832 and affirmatively elects to be treated as a corporation.

Effective Date of Election
An LLC that does not want to accept its default federal tax classification, or that wishes to change its classification, uses Form 8832, Entity Classification Election, to elect how it will be classified for federal tax purposes. Generally, an election specifying an LLC's classification cannot take effect more than 75 days prior to the date the election is filed, nor can it take effect later than 12 months after the date the election is filed. An LLC may be eligible for late election relief in certain circumstances. See Form 8832 General Instructions for more information.
TheAggieInventor
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We are a 3 member partnership LLC
libertyag
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AG
Might want to wait until the plan becomes law, then deal with it.
Endo Ag
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AG
Something will probably pass, but there is no way to know what it might look like at this point.
gigemhilo
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AG
Agree with Endo - no way to know at this point. What he has proposed will not be what is passed (if it even passes).
Ulrich
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Right now we are not even trying to guess what is going to happen, and this is a very large company with tax advantaged subsidiaries.

I'd assume status quo until something passes. The best thing you can do now is make sure your legal documentation and accounting system are squared away so that it's easier to figure out the ramifications if/when something does pass.
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