Got it.
Edit [This answer was technically correct based on original facts, however, those facts changed and so parts of this response was updated in comments above]
This will be a somewhat long response, however, I think it is important to understand the reasoning and the ultimate end result.
All limited partnerships are formed under the applicable state statutes. States will follow either the Uniform Limited Partnership Act (ULPA) or the Revised Uniform Limited Partnership Act (RULPA).
Regardless of which Act the state follows, all limited partnerships MUST have at least one general partner that bears personal liability for partnership obligations.
So in your case, you set up an LLC owned by you, which by default is a disregarded entity under the check-the-box regulations.
Any entity who is required to file an information return with the IRS should be obtaining a form W-9 from all taxpayers. In this case, the partnership would be requesting these from the partners.
For the GP, the W-9 instructions are not the model of clarity, but in the end, the IRS indicates it "encourages" the use of a SSN when the entity is disregarded and owned by an individual.
Having said that, it is really a moot issue who you use for the GP in your case. This is because whether you reflect the single member LLC and its EIN or you individually and your SSN, at the end of the day:
- The K-1 gets reflected on your individual tax return
- You are still ultimately liable for all partner obligations
So the accountant made a decision to use you individually on the K-1 as GP which is not incorrect. The decision could have been made to use the single member LLC and its EIN, but as noted above, the end result for all purposes would be the same.
Also, keep in mind, the presentation on the K-1 is for federal income tax purposes. Having said that, also keep in mind that setting up a single member LLC that has no assets or real substance, while technically a separate legal entity, will certainly be pierced by the judicial system. If it were that easy, all GP's would be set up as shell organizations.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
