When is an LLC S-Election Appropriate?

When is an LLC S-Election Appropriate?

A limited liability company, or LLC, is a business entity created under state law. Owners, or Members, of an LLC may elect to be treated as a partnership or corporation for federal tax purposes. Simply by checking the partnership box, Members may escape C-Corporation “double taxation” and fall within a pass-through taxation regime. Members may also avoid double taxation by electing to be treated as a corporation and filing an S-Election. Though pass-through status is available to an LLC whether treated as a partnership or S-Corporation, other tax and structural issues make it important for Members to carefully select the tax designation best suited for their business.

For more information, I suggest contacting a tax attorney. Here's a link to my favorite barrister of the internal tax code arts!

Beaufort "Shawn" Martin, Esq., CPA
http://www.linkedin.com/in/bsomartin