The LLC is owned by my wife and I who were partially funded by the aforementioned consultants, and we pay them a % of the profits each month. Would they classify as employees who need an EIN and taxes withheld? I want to make sure of this so I am not taxed on the amount I am paying them.
2007-11-09 02:59:07 · 6 answers · asked by 99Audi 1 in Business & Finance ➔ Taxes ➔ United States
Yes, you need an EIN, even if you don't pay them a salary.
You also need an accountant if you have to ask that here.
2007-11-09 03:03:26 · answer #1 · answered by Feeling Mutual 7 · 1⤊ 0⤋
If you and your wife are the sole members (owners) of the LLC, then you should issue a 1099 to the consultants at the end of the year for the amount you have paid them. Then it is treated as an expense to the business so you don't get taxed on that amount. If you have paid them in excess of $600, you are required to have them complete Form W-9, and issue the 1099 at the end of the year.
P.S. A Partnership is the WORST kind of business entity out there. If you do that, you expose yourself to liability for your partners' (e.g. the consultants) acts - even if you have no knowledge of them.
2007-11-11 05:28:44 · answer #2 · answered by Anonymous · 0⤊ 0⤋
A multi-member LLC is taxed as a partnership, except it elects to be taxed as a C or S company. i'm not attempting to be abrubt, however the questions you asked do not lend themselves to rapid solutions. those are complicated factors and countless paragraphs could be written approximately virtually each and all the questions you have asked. The quickest question to respond to could be form 5. definite, you would be breaking the regulation. in case you merely allowed to artwork for a million business company, and you artwork for yet another (even by way of attempting to hide the artwork as "donating time") you're in violation of the words of your immigration status. between the ideas in tax regulation is substance over style, meaning that the IRS will bypass with what a transaction is fairly than what that's called. on account which you're working, calling it something else won't artwork.
2016-12-16 03:20:41 · answer #3 · answered by ballow 4 · 0⤊ 0⤋
I'm from australia and recently brought a buisness and what i do, i believe i'm the best at it in the world.
So when my accountant makes an error thinking i'm a dud and i would'nt notice, ha ha i just laugh.
Mate concentrate on the $$$ from 9-5 from 5-8 concentrate on family, from 8-10 sort out the crap and by 10:30 you can please your wife and concentrate on sleep.
Live 1 time only so everyone can go get there own while we get it b4 them.
2007-11-09 03:10:10 · answer #4 · answered by Anonymous · 0⤊ 1⤋
I would suggest that you have a "Partnership".
We would need an EIN an you would file a Form 1065 each year with Schedules K-1 for each of you.
2007-11-09 03:02:40 · answer #5 · answered by Wayne Z 7 · 0⤊ 1⤋
I would think not, you would 1099 them as a business expense.
they would have to have a SS number, UBI, or a tax id number
2007-11-09 03:05:24 · answer #6 · answered by BMS 4 · 0⤊ 0⤋