If you're not aware, you can file form 8832︉ to have a LLC treated as a corporation for tax in the US. Then it︊ becomes the same as an inc for tax treatment in the view of IRS. Similarly,︋ if the LLC is not tax anywhere then you could also decide to have it︌ issue dividends if that suits your situation/operation. And in the owner live in some countries,︍ they will treat distributions from the LLC as dividends in any case, no matter how︎ IRS looks at it.
Us Llc non resident
- Thread starter Obelix
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I am very much aware (personal experience) of the LLC elected as︀ a C-Corp for tax purposes, I thought I already made that clear in my posts?︁
What is also clear is that an LLC does not issue stocks and distribute dividends.︂ An LLC is owned by members and they make income on shares of the profit,︃ not dividends.
Just because an LLC files to be elected as a C-Corp for tax︄ purposes does not make it a C-Corp. The legal entity and the selected choice of︅ taxing is not the same in USA, two different things.
What is also clear is that an LLC does not issue stocks and distribute dividends.︂ An LLC is owned by members and they make income on shares of the profit,︃ not dividends.
Just because an LLC files to be elected as a C-Corp for tax︄ purposes does not make it a C-Corp. The legal entity and the selected choice of︅ taxing is not the same in USA, two different things.
Yes, this we do agree on 🙂 . Just don't call it a dividend when it comes to LLC's, not to confuse the wording and meaning of a dividend from a "stock company", corporation.
Regarding LLC distributions to other countries I've never done it this way and I have no idea if that works. Perhaps it's easier managed if the both countries do have similar legal entity models, eg. both have LLC's and thus would be recognized as such.︀ Not sure. But since you could tax it this way, maybe a country would just︁ treat it as a regular dividend. I have no idea.
But again, what is the︂ point of having an LLC, taxed as a C-Corp to achieve the distribution of profit︃ in the same way as a C-Corp? Just register the C-Corp and be done with︄ it.
Regarding LLC distributions to other countries I've never done it this way and I have no idea if that works. Perhaps it's easier managed if the both countries do have similar legal entity models, eg. both have LLC's and thus would be recognized as such.︀ Not sure. But since you could tax it this way, maybe a country would just︁ treat it as a regular dividend. I have no idea.
But again, what is the︂ point of having an LLC, taxed as a C-Corp to achieve the distribution of profit︃ in the same way as a C-Corp? Just register the C-Corp and be done with︄ it.
"For income tax purposes, an LLC with only one member is treated as an entity disregarded as separate from its owner, unless it files Form 8832 and affirmatively elects to be treated as a corporation."
Link to IRS:
https://www.irs.gov/businesses/smal...yed/single-member-limited-liability-companies
Once you elect the LLC to be taxed as a C-Corp it is not treated as disregarded by the IRS, even though it would only be a Single Member LLC (eg. have only 1 member).
Maybe I'm missing something here?
Link to IRS:
https://www.irs.gov/businesses/smal...yed/single-member-limited-liability-companies
Once you elect the LLC to be taxed as a C-Corp it is not treated as disregarded by the IRS, even though it would only be a Single Member LLC (eg. have only 1 member).
Maybe I'm missing something here?
Just wondering: if a cypriot non-dom uses the single member LLC (disregarded for tax purposes) just as passive investments vehicle (stocks, some dividends from regulated companies, some interest) then it should be sufficient to
- declare capital gain only if from trading (as exempt︀ art.8 income law)
- not declare long term capital gain (since not even object of︁ taxation)
- declare dividends (but exempt as non dom)
- declare interest (but exempt as︂ non dom)
eventually pay GHS on dividends and interest.
So while for an active business︃ it sounds complicated due to POEM, etc... in this specific case where it plays a︄ role more as vehicle of asset protection, does it sound compliant?
- declare capital gain only if from trading (as exempt︀ art.8 income law)
- not declare long term capital gain (since not even object of︁ taxation)
- declare dividends (but exempt as non dom)
- declare interest (but exempt as︂ non dom)
eventually pay GHS on dividends and interest.
So while for an active business︃ it sounds complicated due to POEM, etc... in this specific case where it plays a︄ role more as vehicle of asset protection, does it sound compliant?
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