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A member of an LLC that is treated as a partnership for tax purposes cannot be an employee (can't receive a W-2).
Any remuneration paid to members is treated as a guaranteed payment. Reported as an expense on page one of the 1065 and also reported separately on the member's K-1. This is considered self-employment income for the member.
This is not an equity draw (distribution), but an expense of the company and income to the member as a guaranteed payment.
A member of an LLC that is treated as a partnership for tax purposes cannot be an employee (can't receive a W-2).
Any remuneration paid to members is treated as a guaranteed payment. Reported as an expense on page one of the 1065 and also reported separately on the member's K-1. This is considered self-employment income for the member.
This is not an equity draw (distribution), but an expense of the company and income to the member as a guaranteed payment.
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