For a self-employed taxpayer or independent contractor, there are very few reasons not to establish a limited liability company. Although it is a relatively new business entity as compared to corporations, partnerships, or sole-proprietorships, it already offers a wealth of flexibility, protection, separation, and other benefits for qualified taxpayers.
Aside from the obvious reason of a lower tax basis, the LLC offers a solid line of separation between a taxpayer’s personal and business liabilities. For an independent contractor who may use one vehicle for both personal errands and for their business, work out out of a home office, or provide a service in other people’s homes, this protection is essential.
Because the LLC is primarily recognized at the state level of taxation, the IRS actually offers the taxpayer options as to exactly how to classify their business at the federal level.
About Five Stone Tax Advisers
Five Stone Tax Advisers has years of experience negotiating directly with the IRS to get the best possible outcome for you. Our International Tax Advisory and Compliance unit has a team of tax attorneys, certified public accountants and enrolled agents that form a single sourced point of contact that will provide services for all the legal, compliance and financial reconstruction aspects of offshore account cases.