
By Giselle Ayala Mateus
First, a partnership exists when two or more people carry a business together as co-owners. This is, they share expenses and profit. To be in a partnership you don't need any formal act, a partnership can be derived from the conduct of the partners. Being that said, partners don't create a legal entity different to them, so they file their taxes as individuals. For more information about the tax implications of being involved in a partnership, you need to consult your tax attorney or an experienced accountant.
Second, an LLC is a legal entity independent of its members. An LLC can be managed by its members or by managers. LLCs can choose to be tax as a corporation or as a partnership. If the LLC is being taxed as a corporation the LLC does not have to inform the IRS of the specifics of who owns equity in the LLC. This is speaking in general terms. If the LLC is being taxed as a partnership the situation is different because there is no dual taxation and the partners pay taxes on the income they received from the LLC.
This is what you need to have clear when thinking of the tax consequences of being on partnership or an LLC. From here, you should probably contact your tax attorney or your accountant.
The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Readers of this website should contact their attorney to obtain advice with respect to any particular legal matter. No reader, user, or browser of this site should act or refrain from acting on the basis of information on this site without first seeking legal advice from counsel in the relevant jurisdiction. Only your individual attorney can provide assurances that the information contained herein – and your interpretation of it – is applicable or appropriate to your particular situation.
Comments
There are no comments for this post. Be the first and Add your Comment below.
Leave a Comment