| Limited liabilities companies or LLCs are a | | | | Otherwise if a business claims to be a LLC |
| tricky bunch to get any kind of LLC tax | | | | but is not a corporation they can file a |
| deduction on. This is because the LLC tax | | | | special form, Form 8832 and choose to be a |
| reduction is not actually recognized by the | | | | corporation or partnership. As long as there |
| federal government. This can make it | | | | are at least two members they will qualify to |
| difficult for those who classify themselves | | | | conduct business under one of these headings. |
| as LLCs to pay their federal taxes. But there | | | | If there is only one member they can only be |
| are three options that they can try to gain a | | | | classified as a corporation. Still taking |
| tax rebate if they are willing to put in a | | | | advantage of the LLC tax deduction can prove |
| little extra effort. | | | | to be difficult. |
| | | | |
| One of these is filing as a corporation. | | | | There is a default rule that can be taken |
| Another is if they file as a partnership. One | | | | advantage of if a LLC decides not to file a |
| last way is to file as a sole proprietorship. | | | | Form 8832 at all. If there are at least two |
| | | | members it will automatically be qualified as |
| The government itself usually classifies LLCs | | | | a partnership, and if there is only one it |
| as corporations and this is how they are | | | | will automatically be qualified as a sole |
| usually taxed. But doing so may disqualify | | | | proprietorship. This means they have to file |
| them from the full benefit of a LLC tax | | | | taxes as such and try for a reduction under |
| deduction. | | | | these headings. |
| | | | |
| The ones that are usually classified as | | | | Two tips that are helpful in taking advantage |
| corporations are ones that were started under | | | | of getting a LLC tax deduction is to first of |
| a State or Federal statute or under a statute | | | | all definitely file a Form 8832. The other |
| affecting a recognized Indian tribe. These | | | | piece of advice would be to get the help of a |
| ones cannot usually qualify for the | | | | certified tax accountant or consultant. As |
| deduction. Other ones that may have a | | | | you can see there is not actually a LLC tax |
| difficult time with the tax reduction include | | | | rebate, but you can take advantage of tax |
| those who fall under the description in | | | | deductions even if you are a LLC. To get the |
| section 1.892.2-T or under Regulations | | | | most out of a LLC tax deduction, be careful |
| section 301.7701-3 or any company considered | | | | how you classify yourself and you will get |
| an insurance company as well. | | | | the most you can out of it. |
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