#llc
LLC formation, taxation, and accounting best practices explained
A 2026 operating guide to Wyoming business taxes and compliance—4% sales tax with a $100,000 economic nexus threshold, the anniversary-month annual report, registered agent rules, and the federal layer that catches foreign-owned LLCs.
A single member LLC is taxed as a disregarded entity by default but creates the legal separation a sole proprietorship lacks. This guide covers formation steps, the three tax election paths (Schedule C, S-corp via Form 2553, C-corp via Form 8832), and the bookkeeping discipline needed to preserve the liability shield.
Compare EIN, SSN, and ITIN for your small business. Learn who needs which tax ID, how to apply free with the IRS, and avoid penalty-triggering mistakes.
Foreign-owned US LLCs face a $25,000 Form 5472 penalty per missed filing, 30% default withholding on US-source income, and tighter 2026 BOI rules. This guide covers the entity choices, forms, treaty benefits, and bookkeeping habits non-resident owners need to stay compliant.
File Schedule C with Form 1040 if you earned $400+ from self-employment. Learn filing thresholds, deductions, record-keeping, and audit red flags for sole
Schedule K-1 reports your share of pass-through income from a partnership, S corporation, or trust — and you owe tax on your allocation, not on the cash you actually received. A working guide to each major box, the phantom income trap, partner basis rules, the 2026 filing timeline, and six mistakes that cost K-1 recipients real money every year.
Section 195 lets new businesses deduct up to $5,000 of startup costs and another $5,000 of organizational costs under Section 248/709 in the first year, with the remainder amortized over 180 months. Phase-out begins at $50,000 and eliminates the immediate deduction at $55,000.
Franchise tax is a state privilege tax owed regardless of profit. Sixteen states plus D.C. charge it, with rates from a flat $300 in Delaware to $800 minimums in California and a 0.75% margin tax in Texas.
A practical breakdown of Delaware's business tax obligations—franchise tax, corporate income tax, gross receipts tax, and LLC annual fees—with calculation methods, filing deadlines, and entity-by-entity comparisons for founders and business owners.
Form 8832 lets LLCs override their default IRS tax classification—single-member (disregarded entity) or multi-member (partnership)—to elect C corporation treatment at the 21% flat rate, with a 60-month lock-in and a 75-day retroactive filing window.
Filing IRS Form 2553 by the March deadline lets profitable small businesses and LLCs elect S-corp status, potentially saving over $12,000 annually by shielding distributions from the 15.3% self-employment tax.
LLCs offer flexible tax treatment — from pass-through taxation and the now-permanent 20% QBI deduction to S-Corp elections that can save $5,000–$50,000 annually. Covers every major LLC tax benefit, real savings examples, and the 2025 law changes that affect your filing strategy.
