If a single-member LLC does not elect to be treated as a corporation, the LLC is a "Disregarded Entity," and the LLC's activities should be reflected on its owner's federal tax return. If the owner is an individual, the activities of the LLC will generally be reflected on:
- Schedule C (Profit and Loss from Business - Sole Proprietorship)
- Schedule E (Supplemental Income or Loss - most commonly, but NOT LIMITED TO, Rental Activities, or
- Schedule F (Profit or Loss from Farming)
Basically, the MOST IMPORTANT thing to do is to, to the very best of your ability, keep track of the income and expenses of operating your business so that you will have an accurate income statement (and balance sheet if applicable) so that it will be easier to prepare and file next year taxes. There are many software that can assist you with the above.
In addition, having accurate financials can assist you in making adjustments to your Estimated Tax Payments, should your circumstances change unexpectedly during the year (example, an increase in sales volume) so that you may be able to mitigate possible interests and penalty payments arising from said changes.
Single member limited liability companies
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