Discussion:LLC return filed using 1120S...no way, right?

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Revision as of 17:57, 19 April 2006

Discussion Forum Index --> Tax Questions --> LLC return filed using 1120S...no way, right?

Sfrey006 (talk|edits) said:

19 April 2006
I have just picked up a small Llc as a client. The prior CPA filed the Llc return on the form 1120S. You can't do that right? By the prior CPA encouraging the client to file as-if they were an S-Corp would allow the company the "flexibility" of the Llc but, the Payroll Tax advantages of the S-Corp. Additionally, cost/charges would be un-necessarily incurred by

1) Prior CPA's charges for 940, 941, and UCT-6 (FL payroll tax) filing.............because, for an Llc they are not needed.

2) The client was told to pay the FL State payroll tax (which is he is exempt from because he is a single-owner LLC

One other point.... the client has a solo 401(k). The prior CPA made the company profit sharing limited to 25% of wages....this would be true for an S-Corp but...........sincethe company is a single-owner LLC, wouldn't the company sharing portion be limited to 20% of net earnings to the owner?

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