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16 Replies Last post: Dec 29, 2007 2:25 PM by LUCKIEST

Does an LLC need to pay Self Employment taxes?

Oct 10, 2007 1:41 PM

Pablo14 4 posts since
Oct 10, 2007

Does an LLC need to pay Self Employment taxes?

Tags: llc_taxes Report as inappropriate

sumfun1 6 posts since
Oct 10, 2007

1. Re: Does an LLC need to pay Self Employment taxes? Oct 10, 2007 1:51 PM

Yes they do. Because you are a limited liability corporation.

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Lighthouse24 2,396 posts since
Oct 10, 2007

2. Re: Does an LLC need to pay Self Employment taxes? Oct 21, 2007 1:42 AM

Yes, if any one of the following applies:

You work more than 501 hours during the LLC's tax year;
Your LLC offers professional services (consulting, health, law, engineering, architecture, accounting, etc.);
You are allowed to execute contracts for your LLC.

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Sunkist 14 posts since
Oct 29, 2007

3. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 10:12 AM

What did you elect on your SS-4 when you were applying for the EIN?

Partnership
Disregard entity
Corporation

?

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Pablo14 4 posts since
Oct 10, 2007

4. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 10:23 AM

in response to: Sunkist

Partnership

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LUCKIEST 7,935 posts since
Aug 6, 2007

5. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 10:51 AM

The LLC in a true sense, does not pay Self Employment taxes.
Any profit the LLC makes is split or passed along to the partners. The partners then pay taxes and self employment
taxes on their share. Do you have an accountant??
LUCKIEST

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Sunkist 14 posts since
Oct 29, 2007

6. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 10:51 AM

in response to: Pablo14

General Partners are subject to self employment taxes and Limited Partners are not subject to self employment taxes depending on certain criterias. It get's complex as well. I recommend you to talk and retain an Accountant knowledgeable in Partnership Taxation and Book Keeping.

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Pablo14 4 posts since
Oct 10, 2007

7. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 10:56 AM

in response to: Sunkist

Thank you. I am in the process of speaking to an accountant. Thanks again.

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Pablo14 4 posts since
Oct 10, 2007

8. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 2:24 PM

in response to: LUCKIEST

Thank you. This is what I thought. I am in the process of speaking with an accountant. Thanks.

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martin1sanche 2 posts since
Oct 28, 2007

9. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 2:10 PM

in response to: sumfun1

1040

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martin1sanche 2 posts since
Oct 28, 2007

10. Re: Does an LLC need to pay Self Employment taxes? Oct 29, 2007 2:13 PM

in response to: martin1sanche

1040

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Excellent 46 posts since
Oct 12, 2007

11. Re: Does an LLC need to pay Self Employment taxes? Oct 30, 2007 10:39 AM

in response to: Sunkist

I'm an LLC with no partners and was instructed, by an attorney, to check off "disregard entity". What does that mean in regards to self employment taxes?

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Sunkist 14 posts since
Oct 29, 2007

12. Re: Does an LLC need to pay Self Employment taxes? Oct 30, 2007 11:15 AM

in response to: Excellent

You are regarded as a Sole Proprietor for tax purposes and your business income is subject to self empoyment taxes.

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BDS INC 131 posts since
Jul 20, 2007

13. Re: Does an LLC need to pay Self Employment taxes? Oct 30, 2007 12:40 PM

The short answer is yes but definitely contact your accountant.

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42n8lady 14 posts since
Dec 11, 2007

14. Re: Does an LLC need to pay Self Employment taxes? Dec 29, 2007 3:56 AM

in response to: Pablo14

What Luckiest wrote is true. As a limited partner, whatever split of the income you receive will have to be entered in your personal tax return. A LLC is a pass through entity.

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Does an LLC need to pay Self Employment taxes?

Oct 10, 2007 1:41 PM

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