Tax Services:

Limited Liability Companies

Limited Liabilities Companies (LLCs) are becoming more and more popular. They offer the tax advantage of taxation as a partnership combined with liability protection similar to a corporation. LLCs are rapidly becoming a preferred form of ownership for small businesses, and they present business owners with many federal and state income tax planning opportunities. Sisterson has been working with LLCs ever since they came into existence.

Our tax department has experience with the tax opportunities and pitfalls of limited liabilities companies, including the following:

• Tax compliance
• Advising counsel on drafting issues involving allocations of tax attributes among partners so that the agreed allocations are respected by the Internal Revenue Service
• Evaluation of ownership interests received in exchange for services
• Analysis and planning opportunities involved with owner’s basis issues
• Planning for property contributions and distributions
• Analysis and planning opportunities involving the “passive activity” loss rules
• Analysis of state income tax consequences; not all of the states are the same
• Implications of “single member” LLC
• Federal and state credits
• Sales and exchanges of members’ interests
• Calculation of special allocations
• Analysis of differences between taxation as a partnership and a C corporation