You might need to complete a W-9 form for tax purposes if your limited liability business (LLC) chose to be taxed as a S corporation. An individual or entity’s taxpayer identification number (TIN), which is required for tax reporting purposes, can be requested via a W-9 form. What you need to know about completing a W-9 form for an LLC taxed as a S corp is provided below.
Get a W-9 for Your LLC: How to Do It
Usually, the party asking for your tax identification information will supply a W-9 form. This might be a customer, a supplier, or anybody else who needs to inform the Internal Revenue Service (IRS) of payments made to your LLC. You can download a W-9 form from the IRS website if you don’t already have one.
taxation of an LLC
Based on the individual tax rates of the LLC’s owners, the tax rate for an LLC taxed as a S corp is determined. An LLC is regarded as a pass-through entity for taxation purposes, which means that the business’s gains and losses are transferred to the owners’ individual tax returns. Since each owner has a different tax bracket, the tax rate for an LLC taxed as a S corp will differ.
Are Distributions from an LLC Taxable? In general, distributions made to an LLC’s owners are not taxable. Any distributions given to the owners that go above their basis in the company, however, might be taxed if the LLC chose to be taxed as a S corp. This is due to the fact that the IRS views these excessive payouts as a capital return, which is taxable income. How to Complete a W-9 Form for an LLC Taxed as a S Corporation The following details must be included on the W-9 form for an LLC taxed as a S corp:
The name of your LLC as it appears on your tax return is your business’s first name. 2. Select “Limited Liability Company” from the drop-down menu and input “S Corporation” in the box that appears.
3. Location: The place where your LLC does business.
4. Taxpayer identity number (TIN): This is the nine-digit IRS-issued employer identification number (EIN) for your LLC.
5. Certification: To confirm that the data you have supplied is accurate, sign and date the form.
In conclusion, completing a W-9 form for an LLC taxed as a S corp is an easy process that calls for you to supply fundamental details about your company and its tax status. Consult with a tax expert for advice if you have any issues about completing a W-9 form or the financial effects of having your LLC taxed as a S corp.