Discussion:Purchase of LLC
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Discussion Forum Index --> Tax Questions --> Purchase of LLC
| 8 January 2007 | |
| My client purchased 100% interest in LLC during the year 2006.I am not sure how to prepare the income tax return? Will it be two return for 2006 or one return? | |
| 8 January 2007 | |
| What income tax return? Your client will file a 1040 for a personal return and if his LLC is a disregarded entity (Schedule C) that will be filed with his 1040. If it is a corporation, then yes, you will file (2) returns; a corporate one and an individual one. | |
| 8 January 2007 | |
| I mean tax return before sale of LLC and tax return after sale of LLC.All members are different after the sale.LLC continued with old FEIN. No new FEIN obtained. | |
| 8 January 2007 | |
| Hi Jigisha,
Realize that all 'LLC' tells us is that we do not know how the entity is taxed at the Federal level. This sounds like a partnership buy-out. A new EIN will be required as a one-member partnership cannot be. The final 1065 will be filed this TY as a final return. The SMLLC will go to the schedule C partial year unless the member chooses to be taxed as an corporation. | |
| 8 January 2007 | |
| Thanks Will. I was going to put that as a sideline and then got distracted...hehe
But a partnership as he says is dissolved if it relegates to one individual and the final return for the 1065 needs to be filed.... | |
| 8 January 2007 | |
| It was partnership before and partnership after the purchase. | |
| 8 January 2007 | |
| And I believe both partnership will file form 8308 with the tax return since there is purchase of inventory. | |
| 8 January 2007 | |
| If 50% or more of the partnerships capital interest changes hands the partnership effectively dissolves requiring a new EIN. (and a second return for this TY) Sec. 706
will | |
| 8 January 2007 | |
| I think so I will have to get more information from my client.Thanks for all these information. | |
| 12 September 2007 | |
| I am new with the Sale of the SMLLC and I am wondering what and how will the "hot assets" be reported? | |
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