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Taxes filed under wrong entity classification?

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  • Taxes filed under wrong entity classification?

    We are PLLC treated as a partnership , I just realized that my accountant was filing taxes as a general partnership (Form 1065 Schedule B ,Section1) instead of LLC . Do I need to do anything to address this issue ? Do we need to amend last 3 years of tax returns? or do nothing and file 2017 under LLC ? My concern is if anyone can challenge Limited liability company status because of tax returns filed as an individual entity?Thank you.

  • #2
    This is a common misconception. Any LLC including a PLLC is a state-charted business entity. It is not a tax structure.

    An LLC by default is considered a "disregarded entity" by the IRS. This means that a single member LLC is treated as a sole proprietorship and a multi-member LLC is treated as a partnership.

    There is absolutely no problem here. Your accountant is filing your taxes properly, there is no such thing as an LLC tax filing.


    • #3
      Yes , taxes were done correctly, but last year when I asked him how to convert to LLC taxed as S-corp , he stated that we have a partnership and can`t change to LLC taxed as S-corp .