S-corp Georgia State 1120S vs Personal return K1

[SCORP2]

I prepared a 1120S for my LLC S-corp and a personal return. Everything seemed fine. 

Then I went back to Turbotax business and added the state of GA. Now it's asking me if I want to pay tax on through the business return, but I don't, it's showing more owed than I have in my personal return. How do I delete it? I tried to delete the forms, but it's coming back up.

But also, do I need to prepare a GA state return for S-corp in TurboTax business?? Or just do the federal return, get the K1, enter it in my personal return and pay the state there?

Thank you!

[PatriciaV]

According to the Georgia Department of Revenue, if your LLC does business or owns property in Georgia or receives income from Georgia sources, you must file a Georgia business income tax return.

The S-Corp itself doesn't pay Georgia income taxes. Instead, the income flows through to the members and is taxed on their personal State income tax returns.

[SCORP2]

See this article to what I was referring to. Don't know if it will benefit me though.

https://moorecolson.com/georgia-pass-through-entities-now-allowed-to-deduct-state-income-tax-entity-...

[mgarry3416]

The State of Georgia has the option for partnerships returns to "pay"  the individual income tax at the partnership level at the highest individual rate for the benefit of the members or partners.  What I don't know is if paying the GA State income tax this way would eliminate the need for out of state members or partners from needing to file a separate State of GA income tax return.  If it did it would be worth paying the GA state income tax at the highest rate then having all out of state members or partners having to file individual GA State returns.

[PatriciaV]

Individuals with flow-through income from a Georgia source are required to file a Georgia State income tax return, even if they don't live in the state. 

The information on this link may help you decide if paying taxes at the entity level is the best choice for your partners: HB 149 Pass-Through Entity Tax FAQ

@SCORP2 

@mgarry3416 

[mgarry3416]

Thanks for your response.  

What we are trying to do is to avoid  having to file a separate GA state income tax return for each out of state member.  What we have is our Mother died last year and left the house to us kids (the youngest is 59).  Three of us live outside GA.   Our sister who lives in GA near the house has a friend who manages property and  convened her that it would be better to rent it out rather than sell the house.  There is no mortgage on the house.  This first tax year we are showing a loss due to depreciation.  Next year we should show a profit.   Our sister thinks we will be paying tax preparers more to file separate tax returns that the tax itself. 

So again the question given that none of us other than our sister who lives in GA and having no other income from any sources in GA ; would we who live outside GA be required to file a GA State income tax return if the LLC we use for Moms old house pays the GA state income tax?

[LeticiaF1]

As it was mentioned before the S-Corp will have to file a Georgia return.  Whether the members would have to file a Georgia state return or not depends on what their income will be.  The filing requirements for Georgia non-residents are:

• If you received Georgia sourced income, like wages, Georgia lottery winnings, Income from flow through entities (S-Corporations, Partnerships, LLCs, Trust, and estates, or rents and If you are a legal resident of another state, you are not required to file a Georgia income tax return if:
  • Your only activity for financial gain or profit in Georgia consists of performing services in Georgia for an employer as an employee
  • The compensation for services performed does not exceed the lesser of five percent of the wages in all places or $5,000.00

 A full explanation the filing requirements for non-residents is provided in the IT-511 Individual Income Tax Booklet.

@mgarry3416 

[bjstarnes]

I am completing my Ga S Corp tax return and it is trying to charge me $600+ tax.  Why?  Always in the past, nothing was charged by GA and we handled it on our personal taxes.