Regarding California LLC formed Nov 2020, Form 568, EIN, Tax year 2020, Single Member LLC (SMLLC) questions

[mbgsvo]

Hi,

I have looked thru a lot of the Q&A on CA LLC (form 568) for getting information that I need, but had some specific questions, which I am hoping someone can answer.

We have used Turbo Tax for many years for our personal Federal & CA State taxes, and we like it.

For context, we created a SMLLC in CA for rental purpose Nov 2020, and I understand that CA needs to to have the $800 Franchise Tax Board payment  (Form 568) to be sent within 3 or 3.5 months of forming the LLC. Thus, I need to complete our taxes sometime in Feb 2021 so that we are not late.

We applied online for LLC's  EIN at IRS website (for banking purposes), and received one from the online website (by the way, it was down for a long time over the winter break, but was up as of end of last week)

1)  Can Turbo Tax Home and Business for Tax year 2020  be used for filing Form 568 along with my Federal & CA State taxes? 

I assume the answer above is YES for SMLLC, but wanted to confirm -

2) There was a lot of discussion on this forum last year in 2019  and early this year in 2020 whether Turbo Tax Home & Business *can* or *cannot* efile Form 568 for Tax Year 2019.

Many answers said you can efile your Federal & CA State taxes (even if it has Form 568 in it), but then TT will ask you to print Form 568 so that you can mail it separately to Franchise Tax Board (after applying for efile waiver from Franchise Tax Board)

Does anyone know whether this has been fixed?  That is, can Turbo Tax Home & Business for Tax Year 2020 efile  Federal/CA State along with Form 568?   

Or is it still the case that I will be able to efile  my Federal & CA State taxes, but have to mail Form 568 separately? 

3) I would like to make sure we use our EIN for Form 568 - Does Turbo Tax Home & Business for Tax Year 2020 allow LLC's EIN to be entered somewhere?  Is this obvious? 

4) Finally, given that I need to submit my Form 568 *earlier* this year (first time for our LLC), do I have to go through *all* my Federal & CA state taxes in Turbo Tax  *BEFORE* Form 568 can be completed by Turbo Tax? 

Or can I somehow just file Form 568 information first, print it, mail it with the $800 check, and then later complete my Federal & CA State taxes? 

5) Finally, I was told by a friend that the $800 can be paid *online* at California Government website for LLC, and the Form 568 can be mailed in later.

Is that true?  Does anyone know the website where to pay $800 LLC tax with Franchise Tax board? 

If I pay the $800 online, do can I submit my Form 568 later than Feb 2021 (i.e. use the April 15 tax year deadline for this)? 

Thanks,

Mahesh

[mbgsvo]

Anyone from Turbo Tax community or company has answer to these questions? 

Thanks

[JotikaT2]

Thank you for your patience.  

In regards to your questions, I will break them out to make it easier to see the answers.

1. Yes, you can use TurboTax Home & Business for Tax year 2020 to file Form 568 along with your personal Federal and State income tax returns.
2. In 2020, you will be able to electronically file your Form 568 when you file your personal income tax return as long as you only have one Form 568.  If you have multiple Form 568 forms, you will not be able to electronically file using the program.
3. Yes, you will need to enter your EIN in the federal section of the program when you enter your business information.  This will pull into your state single member LLC information.
4. Yes, you will be given the option to print your Form 568 to meet the earlier filing date.  You can then go back into your return and complete your federal and state personal income tax later.  However, your Form 568 is technically not due until April 15th.  It sounds like you are trying to pay the annual fee that was due with your 2020 LLC return on Form 3522.  If this is the case, you will use Form 3522 to make your payment for the 2020 income tax year and you can file your Form 568 by the due date of April 15, 2021.
5. Yes, you can pay your fees online. Please use the following link to make your LLC payment.  Scroll down to the Annual Tax section to find the link to pay.

FTB link to pay LLC fees online

Form 3522 will be used to pay your Annual Fee of $800.

CA single member LLC yearly payment voucher sample

Form 568 is your Limited Liability Company Return of Income tax return that is due by April 15th of each tax year assuming you are using a calendar year end.

[ggscott]

I'm getting an error on completing Calif Form 568.  Turbotax is saying that 'Form 568 p 1-2 has not been approved for release at this time'.  I believe that I'm on the current version, so when will Turbotax be updating Form 568 for release and eliminate the error for filing?

I'm using Mac Desktop version, Application 2020.r18.039.

[mbgsvo]

Thank you for your answers - 

[mbgsvo]

Interesting - I will be going thru this same process, have a desktop CD installation. Do reply back if you are able to complete CA 568 after installing some updates..

[cherry12345]

Ok so I just was able to efile my CA state return- I have a single member LLC and the return was accepted by the state. I do not feel confident though...like do I need to also mail in the form 568?

Last tax year (which was my first year with the LLC) turbo tax would NOT let me efile, and had me print and snail mail my return due to form 568. This tax year turbo tax initially gave me a warning that I would need to snail mail my return in again, but that I couldn't even complete it because the form 568 wasn't ready. It became ready on 2/25 and I was able to complete my return and efile it all. No where on the tax documents does it say it MUST be snail mailed like it did for last years. It only states that the voucher must be mailed in with payment for $800 OR I can pay online (which I did).

It now shows my CA return has been accepted by the state. Is that it? Am I done?

I tried to ask the live support on Turbotax this question and they couldn't answer me and said I need to talk with a CPA via their phone support. I tried calling but wasn't able to get past the automated menu to what I needed and ran out of time due to personal obligations....so I figured I would ask on here.

In this thread it sounds like I am fine, the return was able to be fully efiled. I guess I just want to see this confirmed again since every other discussion thread says that form 568 must be snail mailed....

[DawnC]

Although it says in the Forms Availability for California, that Form 568 cannot be e-filed, it does seem as if yours was e-filed.   If you look on Form 568, p 1-2, at the bottom, there is a notice.  If the box is checked, you have to mail the form, as it can't be e-filed.   But if that box is not checked, it appears the form can and was e-filed with the rest of your return.  As long as your Form 568 does not include one of those exceptions, it can be e-filed.     @cherry12345

[Nguy6767]

Cherry, 

I am also in CA.

I am using the TurboTax Home and Business, CD version and I am trying to prompt that Form 568 to fill it via Turbotax, but I does not show up after I was done with all my taxes and entered all my business information.  

What did you do to have access to that Form 568 with your turbotax?

[mbgsvo]

I have not been able to get to any page with TT home and business that indicates that 568 will be efiled. However, I did manager to get a print out of CA 568 (and also decided to get a waiver from the FTB website for the same)

However, I have another question which is causing some  pain for me.

We (husband and wife) have an LLC (established last year, 2020) for a condo that we rent in CA.

We want to treat this is a disregarded entity (single member LLC) for tax purposes.

My question is:  Can I create two businesses in the Federal portion  (with two different names - LLC Name (A) and LLC Name (B))  so that my wife and I can both have Schedule C's, with the profits and expenses divided in half, but then COMBINE the two to generate ONE  CA 568 form with our EIN? 

Do I specify the EIN (same one) for both Federal businesses that I create, or do I leave it blank? 

Do I say that the two businesses are somehow related to each other in the federal portion ?

Finally, when generating CA taxes, it gives me the option to create a single CA 568 form - How do I combine these two businesses into the single CA 568 form? 

I have not been able to do the above successfully as yet -  However, I did went thru an exercise where I created just one business under one of our names, and generate the CA 568 form when doing CA taxes portion .

Any help would be greatly appreciated. 

thanks,

mbgsvo

[dkaufman]

I am using home & business on a Mac and even though I've entered schedule C information, I can't get it to add the 568 and 3522 and whatever the other form is. It's extremely frustrating. I don't really care whether it is efiled or not, I just want TurboTax to bleepin' well FILL IT IN FOR ME. I'm SO frustrated with TurboTax. Schedule C only, no K-1. Everything looks fine, all the numbers are right except for the absence of 568 and the two payment vouchers.

[ToddL99]

@dkaufman

Here is the process to create CA Form 568 in TurboTax Home & Business (MAC):

1. Go to the Forms View and select Open Form.

2. Select the California Individual list and enter "568" in the Search window.

3. If the 568 was already started, you will have the option of selecting/opening it.

4. If there isn't a 568 in your file, select "Create a new Copy" - the program will show the Schedule C's in your return and you can select it there. The program will

    create a new Form 568 for that Schedule C. When I did this, the 568 was blank - don't worry , that will change.

5. Once you have a Form 568 started, go through the CA state interview until you get to the screen "Here's the Income California taxes differently".

6. Go down to the Business section of this screen and either Start or Revisit the Business Profit or Loss Adjustment.

7. On the next screen, select the business that you chose when you created the 568 (above, step 4.). 

8. The succeeding screens ask if the business is owned by a a Single-Member LLC. Answer Yes.

9. The following screens show the 568 populated with what was on the Schedule C. My sample screen has a lot of blanks because I left out a lot of information to

    speed up the trouble-shooting process. Also, the Schedule C interview in federal doesn't ask the questions that CA needs answering. You won't get a K-1 for a

    Schedule C.

10. Somewhere above (probably step 8.), Form 3522 was also created.

The following screens provide a sample of what these interview screens look like, to aid you in navigation.

[dkaufman]

Thanks for the reply. I actually figured it out on my own when I put the form in and happened to notice that question. As soon as I checked that box on the form, most of it populated. I've NEVER had to go through that much of an ordeal before, and it's ridiculous that it took 5 days and several hours and multiple messages with multiple of you guys to get this sorted out. Also, the error check would tell me that question P needed to be filled out and give me three choices but not actually show me the question. 

[nikul_patel]

Thanks. I have entered business information in Federal section (with EIN, LLC information). When I see my California returns, I do not see CA 568 form filled. Am I doing something wrong? I am using CD version of TurboTax 2020 on Windows.

I don't think Turbotax ->Business section even asked me whether this is LLC or not. It was reported as a schedule C business (this is single member LLC). I think since TurboTax Federal doesn't know that this business is LLC, it is not pulling info on CA 568. Your help is greatly appreciated. 

[jeemoss]

Great share. It seems all of us are into it and have established at least one LLC.  LLCs, Corporations, LPs, LLPs, or GPs working in California need to enlist and shape their legitimate substance with the California Secretary of State's Office, document proper duties, register as a business and get permits to operate and different licenses from fitting urban communities or provinces. The California LLC yearly expense is a continuous charge paid to the state to keep your LLC inconsistency and on favorable terms. It's generally paid each 1 or 2 years, contingent upon the state. This charge is required, paying little mind to your LLC's pay or action.