SunTaxMan Posted April 7, 2008 Report Share Posted April 7, 2008 Is there any way for sole proprietor to become LLC and opt for S-Corp without new FEIN? Any way to avoid new accounts for IRS, State withholding, SUTA..... I didn't think so, but I figured I may just not know everything....... Quote Link to comment Share on other sites More sharing options...
KEYWEST_RICKS Posted April 7, 2008 Report Share Posted April 7, 2008 an llc can elect to be taxed as a corporation. i forget what the form is right away. the default is to be taxed as a partnership but once you elect to be a corp you can then elect to be an s corp is all other requirements are met Quote Link to comment Share on other sites More sharing options...
SunTaxMan Posted April 7, 2008 Author Report Share Posted April 7, 2008 an llc can elect to be taxed as a corporation. i forget what the form is right away. the default is to be taxed as a partnership but once you elect to be a corp you can then elect to be an s corp is all other requirements are met I agree with your comments, but you missed the question....... Is there any way to go from sole prop to llc without a new FEIN (and subsequent new registrations, accounts, etc.)? By the way the S election form is 2553. Quote Link to comment Share on other sites More sharing options...
jainen Posted April 7, 2008 Report Share Posted April 7, 2008 >>subsequent new registrations, accounts, etc.<< You are setting up a new entity, so you will at least need a new EIN. I don't know if you can transfer the state or federal payroll accounts, but it's a bad idea. You want to establish a clear separation between the corporation assets and the owner, so the owner's liability can truly be limited. Quote Link to comment Share on other sites More sharing options...
SunTaxMan Posted April 7, 2008 Author Report Share Posted April 7, 2008 Thanks, Not just the answer I thought was the correct one, but an additonal insight - "so the owner's liability can truly be limited" Thanks, Quote Link to comment Share on other sites More sharing options...
jklcpa Posted April 7, 2008 Report Share Posted April 7, 2008 I agree with jainen. New entity, new accounts, new EIN. On your application to the state for an unemployment account, the state might consider that this is an existing employer (only incorporating for liability reasons) and give you a better rate based on the sole prop's history as an employer. Quote Link to comment Share on other sites More sharing options...
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