Hi…I’m one of Lee’s students and I have 2 questions I was wondering if you could help me with.
Thanks much! Sabrina G.
Question 1. To set up my LLC to be taxed as an S corporation rather than partnership, what forms do I need to fill out (I’m in Indiana)? And where do I send those forms?
A. They are IRS forms, not Indiana State specific. First you need the SS4 tax id. Then form 8832 should be filed to create a corporation and then about a week later form 2553 needs to be filed to designate the corporation as an S corporation. Get them from IRS.gov. Do you have the accumulation and preservation of wealth set or the LLC Wizard set? The LLC Wizard goes through all of this in detail (line by line).
Question 2. I’m looking to set up the bank checking account for the LLC. Should I put the account in the name of the LLC or should a trust be set up for this?
A. The account needs to be in the name of the LLC. The trust is the member of the LLC and the trust owns the LLC, not you. This avoids probate on the LLC when you die. If you are doing an S corporation, the trust has to be a “special form” of living revocable trust. The trusts in the Accumulation and Preservation of Wealth Course are sub S qualified trusts, because of their wording.
