Entrepreneurship · Lifestyle

Can An LLC Elect S-Corporation Taxation?

Yes, in fact, it can. This gives the owners a “best of both worlds” situation wherein they can gain the advantages of an LLC while being taxed under an S-corporation structure.

Can An LLC Elect S-Corporation Taxation?

It’s incredibly useful for the right kinds of businesses, and all it takes is a little planning and the right paperwork. If you are running an LLC and looking to be taxed as an S-corporation, there are a few simple steps to take.

  • After your LLC paperwork is filed, elect to be taxed as a corporation by filing Form 8832
  • Once that form is filed, use Form 2553, Election by a Small Business Corporation, to choose S-corp taxation

One question that entrepreneurs often pose about this move is whether or not it requires a special tax ID. That’s because the main reason to elect for this taxation structure is to enjoy the protections of an LLC while enjoying pass-through income and the ability to balance payments to owners between dividends and salaries subject to regular withholding.

 

Tax ID Numbers for LLCs Choosing S-Corp Taxation

The good news is that your LLC tax ID number is going to be the same no matter what your taxation election happens to be. That means if you have already filed for a tax ID for your company, you won’t need a new one. The S-corp tax ID number only becomes necessary if your company totally restructures as an S-corporation and gets a new charter from your state.

If you are looking for an efficient way to get your tax ID quickly, you need to work with a filing service that understands how to simplify your application. The team at IRS EIN Tax ID Filing Service does just that, by putting together an application process that simplifies the information to make it easy for you to provide accurate information and get your ID. For more information, check out IRS-EIN-Tax-ID.com.

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