TaxmannEA Posted June 20, 2018 Report Share Posted June 20, 2018 This is a new situation for us, so I'm asking for some guidance. We have a client who is a single-member LLC who is expanding his business into new locations and activities. He has formed a series LLC with 4 series LLCs under the master. 2 have retail sales, one is a consulting firm, and another trains for concealed carry. We know how to handle the income tax and sales tax for these, but we're wondering about the treatment of payroll. The master and series businesses all have their own FEINs that were secured by the lawyer that drew this up. Does the master LLC report all payroll under it's existing payroll structure, or will we need to set up separate accounts for each of the series? Not all of the series LLCs will have payroll. We just need to be pointed in the right direction. Quote Link to comment Share on other sites More sharing options...
Edsel Posted June 20, 2018 Report Share Posted June 20, 2018 Hi Taxmann - just to add clarification, Series LLCs are not allowed in every state, so many of the readers may not know what it is. A "Series LLC" (first called the "Delaware Series LLC" after the first state to adopt) allows multiple LLCs for purposes of liability but one LLC for reporting purposes. Don't know about Illinois, but the intent from Delaware is to allow a single reporting entity, so the various individual LLCs would not have to file returns for each LLC. The most understandable application of a "Series LLC" would be an owner with 10 buildings. If an LLC were created for each building, the liability for each would be limited to the asset recoverable value of only that building, without exposing the other buildings to that liability. You can do this in Illinois (I think) and about 20 other states. Can't do that in Tennessee (at least not yet). I think Federal allows a consolidated return but I don't know that it becomes feasible in states where consolidated reporting is not allowed. I think the answer to the Taxmann dilemma is to simply paper allocate payroll and payroll taxes to the individual LLCs, and report payroll only under the Master LLC. 1 Quote Link to comment Share on other sites More sharing options...
TaxmannEA Posted June 22, 2018 Author Report Share Posted June 22, 2018 Thanks Edsel. I was just needing a little support as this is the first time we've had this situation. Quote Link to comment Share on other sites More sharing options...
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