![]() ![]() If the business has a profit, the owners pay income tax on their ownership share through their individual returns at their individual income tax rates. Instead, the profits, losses, deductions, and tax credits of the business get passed through the business to the owners' individual tax returns. Pass-through businessįor tax purposes, what distinguishes pass-through businesses is that they pay no taxes themselves. Such LLCs get the same treatment as sole proprietorships for tax purposes. Schedule K-1 is not needed for these businesses. This includes almost every business, except regular C corporations and sole proprietorships in which a single individual personally owns the business. Limited liability company (LLC) with two or more owners.Essentially, any company owned and operated through a pass-through business entity. Schedule K-1 is an IRS form that is important if you are the owner or co-owner of a pass-through business. ![]()
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