Legal Question in Tax Law in California

Taxation of single member LLC

Dear all,

I'm in the middle of converting a Sole Prop. to an LLC (in Calif.) and want to have the LLC taxed as a corp. I've heard it is possible to have a single member LLC in CA, but that it is not possible/good idea to have it taxed as a corp?

If corp-tax is possible why would any select partnership taxation of an LLC since the corp tax laws seem to allow more deductions.

Thanks!

PE


Asked on 8/07/07, 1:29 am

1 Answer from Attorneys
Carl Starrett Law Offices of Carl H. Starrett II

Re: Taxation of single member LLC

It sounds like you've received some muddled tax advice and I think you are referring to being taxed as an S-corporation. If you want to be taxed like a corporation, then you should just form a corporation.

A corporation is just as easy to form and operate as an LLC and there is practically no price difference in legal fees, at least for what I charge.

What you should do is sit down with a CPA and an attorney to discuss your business plans and income projections. Once you get a recommendation on the best entity for tax purposes, move forward with your plans.

I do not provide tax advice, but I could handle the incorporation or LLC formation for you. Feel free to contact my office if you wish to discuss this further.

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Answered on 8/07/07, 2:35 pm


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