Llc - Ein

[Mercury]

What is the name of your state? NY
Please.....I am applying for an EIN. On the application it says the default tax classification for "an LLC with only one member is disregarded as a separate entity from its owner and must include all of its expenses and income on the owners tax return". Does this hold me ( as an individual) more liable for lawsuites and such than if I were to classify as a association taxable as a corporation?
Thank you!!

 

[seniorjudge]

What is the name of your state? NY
Please.....I am applying for an EIN. On the application it says the default tax classification for "an LLC with only one member is disregarded as a separate entity from its owner and must include all of its expenses and income on the owners tax return". Does this hold me ( as an individual) more liable for lawsuites and such than if I were to classify as a association taxable as a corporation?
Thank you!!

Friend, you need a business lawyer yesterday:

https://forum.freeadvice.com/showthread.php?t=315869

 

[divgradcurl]

What is the name of your state? NY
Please.....I am applying for an EIN. On the application it says the default tax classification for "an LLC with only one member is disregarded as a separate entity from its owner and must include all of its expenses and income on the owners tax return". Does this hold me ( as an individual) more liable for lawsuites and such than if I were to classify as a association taxable as a corporation?
Thank you!!

No. The way taxes are handled has nothing to do with business liabilities. Most LLC's simply "pass through" taxes to the individual owners, so the LLC's taxes are paid via the owner's personal income taxes. This can simply taxes a lot, since you are not calculating taxes at the LLC level, then paying yourself a salary which is taxed separately as income.

You can choose to have the LLC pay taxes as a separate entity, in which case you will need an EIN, but either way, there is no impact on your personal liability for the LLC's doings.

EDIT: I guess the one place where it might matter is if you are not planning to pay taxes on income received by the LLC (tax fraud) -- but even then, an LLC provides LIMITED liability, so you would probably be personally liable either way...