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LLC now or after the first of the Year?

Discussion in 'Business Operations' started by richm23, Oct 20, 2004.

  1. richm23

    richm23 LawnSite Member
    Messages: 24

    I am going to change from a sole Proprietor to a LLC. Should I do it now or after the first of the year for tax purposes. WHich will be easier for my accountant. If I do it now will I have to pay taxes on money I earned earlier in the year as a sole Proprietor and from now till the end of the year anything as a LLC. Thanks for the help.
     
  2. parkwest

    parkwest LawnSite Senior Member
    Messages: 678

    rich,
    How many CPA's and tax lawyers do you think are on this forum?
     
  3. MMLawn

    MMLawn LawnSite Gold Member
    Messages: 3,569


    You should have already paid the personal taxes on the money you have earned under the SP has that is payable each Quarter. So that was due in April, July, and Oct on that part. Yes, if you switch now you wil finish the year with the LLC filing. Long and simple WAIT esp this late in the year.
     
  4. HOOLIE

    HOOLIE LawnSite Gold Member
    Messages: 3,981

    This is one of those questions where I don't understand why you don't just ask your accountant. That's why he makes the big bucks.
     
  5. GardenofWeeden

    GardenofWeeden LawnSite Member
    Messages: 50

  6. GardenofWeeden

    GardenofWeeden LawnSite Member
    Messages: 50

    http://www.irs.gov/pub/irs-pdf/p3402.pdf

    Tax Info on LLC's

    There is info in the PDF file that answers your questions. There are pitfalls to do what you are asking. However...I STILL do not admit I know the answer your question.
     
  7. robin 2

    robin 2 LawnSite Member
    Messages: 27

    Make the LLC effective Jan. 1 of 2005. The risk of causing damage this time of year is less since the mowing season is almost over, so just wait. I am doing the same thing.
     
  8. NCL

    NCL LawnSite Member
    from NJ
    Messages: 132

    My accountant suggested to start the process last week in NOV. to get it ready for the first of the year so not to complicate your tax returns, you would have to file two seperate returns if you did it before the year is out. It takes 3 to 4 weeks to process all the changes.
     

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