When does an LLC need to file taxes?

A limited liability company, or LLC, is a great business to form if you wish to protect your personal assets in the case of liability issues or lawsuits leveraged against the business. An LLC business is quite flexible and may consist of a sole proprietor or several different members. There are a few tax benefits to forming an LLC, but when exactly does an LLC file for tax return?

When and how an LLC files taxes depends on its tax structure. There is no single requirement for an LLC. You can choose to have the business taxed as a sole proprietorship, partnership, or corporation. The method of filing LLC tax returns differs depending on how you choose for the business to be taxed:

  • Sole proprietor: Single-member LLCs must fill out a Schedule C that reports on any expenses and income for the business. The Schedule C should be filed at the same time as personal taxes along with Form 1040 during the standard tax reporting season.
  • Partnership: Each owner or member of the LLC must fill out Schedule K-1 and report his or her individual share of credits, deductions, and income. This is filed with the personal income tax return yearly during the normal tax season.
  • Corporation: The IRS treats LLCs being taxed as a corporation as a separate taxpayer. The LLC must file a Form 1120 every year that reports on all deductions and income. This type of LLC gets taxed two times – on the corporate tax return and on the dividends received by the owners.

State taxes for an LLC may differ. LLCs with regular activity may be able to pay their state taxes quarterly. You will need to check for the LLC tax requirements in your particular state. You also may need to fill out an online EIN application in order to get a business tax ID for your LLC. To apply for LLC formation or to get an EIN, you can find the necessary documents with GovDocFiling.