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arapianoacademy
New Member

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

 
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AlanT
Expert Alumni

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

Yes, it does not matter what the percentages are as long as:

  • the LLC is wholly owned by the husband and wife as community property under state law
  • no one else would be considered an owner for federal tax purposes, and
  • the business is not otherwise treated as a corporation under federal law
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6 Replies
AlanT
Expert Alumni

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

Yes, it does not matter what the percentages are as long as:

  • the LLC is wholly owned by the husband and wife as community property under state law
  • no one else would be considered an owner for federal tax purposes, and
  • the business is not otherwise treated as a corporation under federal law
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
arapianoacademy
New Member

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

so by this way 90% of the social security tax that we paid goes into credit of only one of the spouse, right?
I just don't know why turbo tax software says: The ownership percentage is the proportion of the business each of you owns. If you live in a Community Property State the ownership rules state that your ownership percentage is 50/50!


AlanT
Expert Alumni

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

Because you live in California, the state has laws stating that property acquired by a married individual is owned in common with that individual’s spouse.
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arapianoacademy
New Member

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

thanks for your help! what about my first question about the social security credit? will one of us get 90% of the SS credit or the SS credit will be 50-50 since we live in California?
AlanT
Expert Alumni

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

Split 50/50 because you are a community property state.  
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arapianoacademy
New Member

Can husband and wife who are only owners of a LLC in California file as single member LLC even though they have different shares in the ownership(%90-10%)?

I see. even our social security credits on the w2 incomes will be 50/50 at the time of retirement?
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