Apr
13
How to do the LLC Taxes
April 13, 2010 | Comments Off
This is a list of the products we use and for what purposes:
- Turbo Tax Business to do the 1065 and the K-1 for the LLC partners.
- Turbo Tax Home & Business to do the W-2, 1099 and the personal taxes.
- And QuickBooks Pro for the regular day to day accounting.
I think they manage to extract around $400 in software and fees just because the tax code is very complex and too difficult to do by paper and pencil. When the LLC was young and simple, I was able to create 1065/K-1 and 1099’s by hand. Nowadays, it is far more complex than what I can do by hand.
I wish they at least had a combined product that did it all, even if it costs the same amount.
As to what specific forms you need to do:
- 1099 / W-2 – These are for sub-contractors of the partnership. We are good, but we still need help from very good people. That is where we report what we pay them.
- 1065 and K-1 – These are the partnership taxes. The partnership passes through income/loss to its members. No need to send a check here to anyone. Just a statement to the IRS and the Partnership members so that they can pay their taxes in proportion of their income/loss.
- 1040 – For the personal taxes. We have to include the K-1’s here.
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