Hey guys, been setting up my LLC this week. Want to open a business account in the LLC's name. My understanding is I need to get a tax number. Do I get this from the IRS or from the state of North Carolina? Anything else I have to do before I start officially using this account? Thanks.
Its two minutes on the IRS web site:
IRS EIN application
thanks...that was easy...there's gotta be something else i have to do??
Nope, that's it. It's really just that easy.
well let me ask you guys this...the irs website was asking me all sorts of questions about how i would file and if i wanted to be taxed like a S corp...this is over my head..i rent a few properties..what do you guys think?? thanks
Do you need a TIN if you want the LLC to be a flow-through entity for tax purposes? In that case don't the banks just need the SSN of the "authorized person" that controls the account?
I've always had to have the EIN of the entity to open a bank account. Assuming its just pass-thru, and single member, you don't have to file a return.
Bryan, its asking if you want to be taxed as a corp, not an s-corp. The answer is no for what you're doing.
If you want better answers, you should have a chat with your CPA and lawyer. LLC has no effect on taxes, and I doubt very much you want any effect. LLCs do give some asset protection.
thanks for all yall's help...robert...what's a TIN?? just wondering..thanks
Originally posted by Jon Holdman:
LLC has no effect on taxes, and I doubt very much you want any effect.
Just to expand on this a bit...
LLCs are *normally* disregarded by the IRS as tax entities, but the owner of an LLC can elect to have the business taxed just like any other corporate entity (partnership, sole prop, s-corp, c-corp, etc).
There may be some tax advantages to treating your LLC like another type of entity for tax purposes, depending on the type of business the LLC does, the specific amount of income that's generated, etc.
For example, the LLC I use to flip houses is taxed as an S-Corp, and that election allows me to save some money each year because S-Corps are allowed to pay dividends, which are exempt from FICA taxes...if I hadn't elected to have my LLC taxed as an S-Corp, all income (up to the limit) would be subject to FICA taxes when flowing through to my personal returns...
That said, as Jon pointed out, talk to your CPA before relying on any information here...
i do not want to 'pierce the corporate veil'....how do i invest money into my LLC account w/o mingling funds with my personal account??
Again, if you want to do this right, you MUST speak with your CPA and your lawyer. This is not really a DIY project.
Bill Bronchick's "Wealth Protection Secrets of a Millionaire Real Estate Investor" is a pretty good intro.
"Piercing the corporate veil" is much more complex than just the money. To put the money into your LLC, you would purchase units in the LLC. Document the money going in. But just doing that won't necessarily protect you. You're still the manager, and just like corporate officiers can still be personally liable for their decisions (think Joe Naccio, Ken Lay, Jeff Skilling, and many, many others), you can still end up being personally liable for actions you take on the part of your company.
Bryan, sorry for the confusion. I meant EIN not TIN.
TIN is just Taxpayer Identification Number, a general term. The two most common types are SSN (for individuals) and EIN (for employers), but there are others.
I go and hijack this topic :), incorporate as a LLC or a corporation in the US is not the problem for me as foreigner.
But now I found an banana skin, for the rent collection and for the payments for utilities I need a bank account.
Now its drolly, to obtain a EIN from the IRS I need a SSN, but I dont have these number, so I have a big problem now. I cannot open any bank account in the US without these EIN. I will close in Cleveland January 2010, what should I do?
uwe..are you filing in ohio or did you choose another state?? states have different rules and maybe you could look into that?? maybe none of them will allow an international account..not sure?? i am not much help here..but i do know that bank of america here is partnered with deutche bank..on a side note..congrats on the property...how much work does it need?
Thanks for the advice, I incorporate in Ohio yes. Only the banks says yes for an international bank account and in my case its no bank. They want all the EIN, thats a part of the patriots act.
Thanks for good wishes. With the "how much work" you mean any repairs on the building? There are no repairs, the house is fully occupied (6 apts and 2 storefronts) and need no maintenance today.
how are you able to inspect properties and then maintain and manage them so far away? that is impressive!! i tried to manage a property in north carolina while playing soccer in detroit..wasn't too bad...however i also just purchased a property in north carolina while living in philadelphia...not so easy..had to fly home to do final inspections, close, and make sure the electrician, framer, plumber, and handyman were all on the same page with me...i plan on moving back to manage the property..i just prefer to do things myself instead of property managers, so it's a must for me to be near my properties...did you fly to cleveland to see this property??
Yes, at closing I fly to Cleveland and I have the right to cancel (get my EMD back) when the promised quality is wrong. I have send an house inspector to the propertie, 2 minor problems (seller fix this) and he maked a video for me. I become a new Certificate of Occupy from the Housing City Department.
The house was until May 2007 mismanaged and have a occupancy of under 50%. The owner gaves in year 2002 a owner financing to a friend of him, this was an fault.
Since August 2007 the owner have control over the building and his property manager (owner owns 5 properties in Cleveland) filled the units and make all repairs. The average occupancy is now 97% this year. Last year 94%, 2007 62%.
I have no fear, IÂ´m a property manager in Germany I know the most, so I look in Cleveland for a other rent-to-own multifamily propertie to increase the units.
ok uwe...looks like you got this long distance thing down ...i am still struggling with my long distance situation, but good luck to you and congrats on the closing..did you ever find an answer to your tax number problem?? there must be other foreign investors on this website investing in the US that you could talk to
DonÂ´t found a right solution yet, only I know now, a EIN is linked for a Livetime on a company.
So its possible I think I can find any person in Ohio, who fund the Corp. obtain the EIN by IRS and sell then the company to me. So I have a EIN then. But I donÂ´t know its legal.
Long distance is not the problem if you have the right men, I work here in Germany for a english company with 254 units in my town. The company trust us and we make good work. I overtake the property manager in Cleveland and I see in the P&L, there gaves no problems with him last 2 years.
uwe..i did a quick search on the web..i'm sure you have come across this already,but in case you have not, here it is..this website says you need a Individual Taxpayer Identification Number (ITIN), as opposed to a SSN or EIN...the ITIN is exactly for people like you who are not eligible for a SSN, but still have to pay taxes by law....this link from the government could help possibly
sorry...i do not know how to hyperlink yet, just put that in your web browser though...also it says you need an address in the state in which you file, that's not a po box..have you figured that out yet?
a quick note uwe... it seems the irs allows certain 'agents' to assist foreign businessmen and women in obtaining the ITIN you may need..this link provides several companies in Germany that are such agents..
and to the moderator and everyone else..sorry we got so off topic, but i figured since i started this topic, nobody would complain...thanks guys!
Great work Bryan, thank you!
I called with an German agent he said a ITIN needs 6-12 weeks. Thats a hugh time frame and I have only 7 weeks left for closing (01/15/2010).
So I must do my work very fast.
Thanks again for your sacrifice.
glad to help...let me know how it goes..
As far as getting an address in some state or area, Mailboxes Etc / The UPS Store is one possibility; and there are other mailbox services who operate similarly. You get a real street address - the address of their building - not a P.O. box number; of course, your "unit" is only a mailbox within their building (kind of like a P.O. box in that respect), but so what since it serves the needed purpose. And many of these mail services will forward mail to some other address if you pay them.
Steve, Thanks for the help, but I have a address in the US then, the building address what I buy :).
I must find now only a faster way to obtain these ITIN. In Frankfurt/Main gives an official IRS office I call tomorrow and hope they can help me quickly.
Bryan, thanks for your help, but now I leave your Topic and go back to my official here.
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