SE to LLC to S Corp

Forum|Forum|3 years ago
January 13, 2023
1 reply
33 views

I prepare my daughter and son-in-laws taxes, but they are complicated this year. He started a house flipping business and bought and sold the first house under his name and SSN so it would be on Schedule C. He formed a LLC and bought and sold the second house. Would this go under a separate Schedule C under the business name and EIN? He then filed the papers to make the LLC a S Corp. He bought and sold 2 more house that would be included on form 1120S. He received a 1099S and state taxes were withheld on the first 2 houses but not the other two. We are in California. Is this the correct way to account for the 4 sales?

Not A Product Question

Best answer by Anonymous_

You may be on the right track, generally, but you really should consider using a tax professional for this tax year (or, rather, tell your daughter and son-in-law to do so).

https://taxexperts.naea.org/listing/service/individual-tax-preparation

Actual preparation of tax returns notwithstanding, there are issues with taking a (reasonable) salary for your son-in-law as well as quarterly withholding (Form 941) which might not have been done.

Since this is California, there are likely also state issues.

Guidance from a local tax professional would be highly recommended in this instance.

Anonymous_Answer

Level 15

You may be on the right track, generally, but you really should consider using a tax professional for this tax year (or, rather, tell your daughter and son-in-law to do so).

https://taxexperts.naea.org/listing/service/individual-tax-preparation

Actual preparation of tax returns notwithstanding, there are issues with taking a (reasonable) salary for your son-in-law as well as quarterly withholding (Form 941) which might not have been done.

Since this is California, there are likely also state issues.

Guidance from a local tax professional would be highly recommended in this instance.