We recently formed an LLC in a different state than where we do business and live. What is the correct state to file our LLC tax return? Thank you
Perhaps both and you may need to register the entity in the stare you live and do business in. Get a competent accountant and ask them!
I agree with Lee, you should definitely get a good tax professional. :)
Its difficult to give a concrete answer to your question with the details provided. First, is the LLC a disregarded entity for tax purposes (i.e. is there only one partner in the LLC or is there multiple partners?)? Some states like CA require a state filing regardless if it is a disregarded entity, while other states don't have such requirement. Second, you need to check if the state in question has a LLC state filing requirement.
Another concern that you may or may not have considered is that by operating in another state, you may have state sourced income (SSI) in the state in question. You may need to apportion/allocate the state sourced income so that the income is being taxed correctly by each jurisdiction.
Again, work with a good tax professional that can help you navigate this for you.
The first question should be is this a single-member LLC or a multi-member LLC.
I assume it is a multi-member LLC since you mentioned "we".
You may have the requirement to file a partnership return if this is a multi-member LLC.
Regarding state filings, you normally have to file the return based on where you are domiciled and where there is activity.
The next question should be, do you have to register the LLC to do business in the state that you actually do business in.
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