Filing taxes on an LLC can be tricky, especially if it’s your first time doing so. Although you don’t have to file an income tax return, you have to file an informational return—Form 1065—that gives the IRS information about your company and how much profit it made in the year. But when and how do you file this form? And how do you report what each LLC member paid in self-employment taxes? It’s all explained in this handy guide to filing taxes on LLCs.
Get your paperwork in order
The first thing you’ll need is a Certificate of Good Standing, which proves that your LLC is up to date with all American state requirements. You’ll also need a Registered Agent to represent your business if it gets sued or faced with any other legal situation. Finally, you’ll need an EIN.
The EIN stands for Employer Identification Number and will be used for tax purposes (you won’t need this until April 15th) and registering your company name. If you want to form an LLC with more than one owner, then you’ll need Form 2553 signed by both owners.
Understand your tax obligations
LLCs in American Samoa are treated as partnerships for federal tax purposes. The LLC does not pay income tax, but all members of the LLC pay an annual fee. Members also receive a K-1 form at the end of the year that reports their share of profit or loss from the business.
Form 1065 is used by members who operate a Samoa LLC to report income and losses, and it’s filed with the IRS by March 15th following the fiscal year.
Members of an LLC operating in American Samoa should also attach Form W-9 and Form 8832 to Form 1065 before filing them with their tax returns.
Choose the right filing status
When filing taxes for an LLC, you can file either as a standard or as a flow-through entity. The members of your LLC determine this. If you are the only member, you can choose whichever filing status you prefer. However, if there are multiple members, they must agree upon which status they would like before submitting their tax forms.
Determine your tax liability
You are an American, and you live in America. You have created an LLC (limited liability company). How do you file your taxes for this LLC? When it comes to taxation, there are two main types of entities: a corporation, which is taxed as a separate entity, and a pass-through entity like an LLC or partnership, which is considered flow-through because the profits or losses pass through directly to the owners.
The IRS has rules about what kind of business can be taxed as a corporation and what type must be taxed as flow-through. For your LLC to be classified as a corporation, it needs at least one nonresident alien owner, and its members cannot all be nonresident aliens.
File your taxes
The IRS was created in 1862 and is responsible for helping America collect taxes. It is also the agency that helps people understand tax laws. The IRS has a lot of information about how to file your taxes, but there are a few things they don’t tell you.
They don’t tell you that you must file through the American Samoa Tax Office if your LLC is in America. The other thing they don’t mention is that if your LLC has multiple owners, everyone who owns an interest in the company should be listed as a partner on the income tax return.
Final Words
The IRS provides instructions for filing taxes for an LLC. To register and obtain a Federal Tax ID number, you must complete form 2553-LLC. Once you’ve finished the tax paperwork, you’ll submit it to your state’s Secretary of State office. The IRS also provides information about deducting home mortgage interest and other expenses and how much profit or loss needs to be reported on your tax return in the Passive Income section. If you are operating your LLC in America, you must prepare an annual report (APR) due by March 15th, following the end of each year.
