LLCs
Get help with business registration, organized books, and a tax setup that reflects how your LLC is owned.
What is an Limited Liability Company (LLC)?
An LLC is a legal business structure formed under state law. Owners are called members. Liability protection depends on state law and circumstances; LLC status does not by itself determine how the business pays federal income tax.
Get your business set up.
Formation usually includes state organization documents, applicable fees, and ownership and management arrangements. An operating agreement can document those arrangements. We can support registration and EIN applications within your plan; state fees are paid separately.
Every Clean Accounting plan includes one business registration and an IRS EIN application. Included services depend on your plan and business needs; government filing fees are paid by the client.
How taxes and documents work.
One individual owner
By default, a single-member LLC is usually disregarded for federal income tax. Its business activity is commonly reported on Schedule C with the owner’s Form 1040; rental or farming activity may use other schedules.
Two or more owners
A domestic multi-member LLC is generally taxed as a partnership by default. It files Form 1065 and provides Schedule K-1 to members. Special rules can apply, including certain spouse-owned businesses.
Corporate tax elections
An eligible LLC can elect corporate taxation. C-Corp treatment generally uses Form 1120; an eligible S-Corp election generally uses Form 1120-S and shareholder K-1s.
Documents issued
Owner documents follow the tax classification: no owner K-1 for a default disregarded single-member LLC, member K-1s for partnership treatment, or shareholder K-1s for S-Corp treatment. Employee W-2s and contractor 1099s may also be required.
These are common U.S. federal treatments. State taxes, elections, and your business activities can change the requirements. Records, financial statements, and tax forms each serve a different purpose.