I specialize in structuring tax strategies with entity infrastructure strategies to lower tax liability. Registered Financial Advisor, Entrepreneur, Investor, Tax and Fiscal Strategies Expert.
Unfortunately you have to file your taxes for every year even if you do not have any business activity as well as to comply with your state fillings and the filings for your Secretary of State. You cannot add the activity of 2 years together, there has to be a filing for every year, in this case $0 revenue for 2015 but you still have to file it with $0
Hello, my name is Carlos Quintana and I have worked many years in accounting specializing in tax strategies for entities. This question is very common and very simple to answer, however like any other accounting question the answer might varie according to specifics. Furthermore, a very simple benefit to the election of S-corp would be that you do not pay any self employment tax, which can translate to thousands of dollars being saved. A very important benefit for the entity itself (LLC) would be the easiness to maintain it. There is no requirement to maintain record of your annual minutes to maintain for the shareholder and director meetings. Those is my opinion are 2 of the most beneficial things from a LLC with an S-Corp election.
I agree with some of the things Kathryn said about the IRS testing if you are an employee or Independent Contractor according to different tests they do. However when approaching this in a legal way and also in the way of saving the most money on taxes I disagree with a 1099 being more effective.
First off, with a 1099 you pay Income Tax and Self Employment tax but the main thing you have to look at is that your LLC has the right election to avoid self employment taxes. If your LLC is a disregarded or Single member LLC you really need to look at that election one more time to see if it's convenient to change it and save more in taxes.
The second thing is following the law. If you LLC is not a disregarded LLC or taxed as a Single Member LLC it means it is being taxed as a partnership or you have sent the election to be taxed as a C-Corp or S_Corp. This means that the IRS wants to see the members (shareholders to the IRS if different election) who are active in the business being paid a reasonable salary through a w2 not a 1099. Having said that there are different strategies to reduce your payroll taxes, maximize your deductions with legal allowenses and have part of that as tax free money when you own your own LLC.
Give me a call so I can clear your questions about elections and I can give you some strategies you can use to reduce your overall tax liability with your current LLC.
You should most definitively file taxes. Even though Wyoming does not have any state tax and you have foreign transactions. The US is very specific in foreign transactions. All income shall be reported to the IRS and if there is an international treaty then file the specific forms that will help you avoid paying taxes here in the US. However the fillings need to be presented if you have an active business registered with any state. Are you an american resident or citizen? If you are not then you have to file for an ITIN to present your taxes at a personal level as a single member LLC. If that is the case (that you leave it as Single Member or Disregarded LLC) you might be able to avoid "Income Tax" if the international treaty allows it. However you will not be able to avoid Self Employment Tax which is automatically created when you have a Single Member or Disregarded LLC. I would suggest looking for your LLC to be elected as S-Corp if you are a US citizen or resident. This will save you thousands of dollars.
Sale taxes are only collected when you have sellers permit in the state you are conducting business in. Another condition to collect sales taxes is to sell a product and you sell services.
Services provided such as the ones you listed do not collect sales taxes in any state.
Hope this helps, if you have any other questions make sure to give me a call :)
I will answer this is the simplest form I can. Basically in every country to conduct business in you will need to pay taxes in that country. If you have an office, employees or your revenue comes from that country you have to pay taxes. These taxes will include State, Federal and Sales Tax. Moreover, this at the beginning will make you think you are paying double tax since this income also has to be paid with your local government, but it isn't so bad. This could be a great opportunity to build a tax strategy where you can take advantage of multi country taxation which can lower your overall tax bracket. There are several steps you have to do to conduct business in the US, such as incorporating first as a foreign corporation in the state you chose (Preferably one with no state tax) then filing your taxes. Your tax preparer in Canada will have to take this in consideration since there are forms he has to fill out to cancel either you Canadian Income Tax or your US tax preparer to fill out the return not to pay taxes here but in Canada... whichever tax you have to pay depending on the international treaties they have.