We are a husband and wife LLC in CA started last year and elected S corp. We have dump truck business and working with a different company who uses their driver, find work for our truck and maintains the truck. We don’t have much involvement. I’m just entering numbers in quickbooks at the end of the month once they send me the statement which doesn’t take much time, may be couple of hours max.
Since we both are not working materially for our business, thinking of revoking the S election so we don’t have to take salary. If I take too little salary based on the work I’m doing, it seems high probability of getting audited.
We both have full time job. My W2 income maxing out social security taxes but not my wife’s as she is working part time.
Can I revoke S corp status and choose single member LLC with just me as a member even though we are in a community property state? This way only I have to report business income and don’t have to pay social security taxes as I’m maxing it out in my full time job. With this arrangement can we still file joint return? BTW, wife is okay with not being on the LLC.
If this is not possible, can we change the llc share to 95/5 so wife is only paying social security taxes on very small amount?
How do I go about making this change? Just update statement of information or do I need to send any new forms to state to remove my wife as member of LLC?
The only asset we have is a dump truck which is financed through the dealer. Would revoking S corp affects anything in terms of assets?
