LLCs and S Corporations: Mitigating Self-Employment Tax for Flow-Through Entities
Note: CLE credit is not offered on this program
Recording of a 110-minute CPE webinar with Q&A
This course will assist tax professionals in determining whether flow-through income should be subject to self-employment tax. Our panel of pass-through entity veterans will explain how reasonable compensation, payments to partners, and management authority status affect self-employment tax on distributive share income of owners of pass-through entities. They will examine recent cases and the IRS's position on when pass-through income is subject to self-employment tax and consider how possible future legislative changes may affect current law and planning.
- Overview of self-employment tax on pass-through income
- S corporations
- Self-employment tax considerations
- Reasonable compensation
- Weighing S corporation status
- LLCs and partnerships
- The limited partner exception: law and recent cases
- Planning implication
- Possible legislative changes
The panel will cover these and other critical issues:
- When should an LLC member's flow-through income be reported as self-employment income?
- How can payments to partners be structured to mitigate self-employment tax?
- When do the disadvantages of S corporation status outweigh the potential self-employment tax savings?
- How might future legislative changes affect planning for self-employment taxes for LLCs and S corporations?
James R. Browne
Barnes & Thornburg
Mr. Browne advises clients on the U.S. income tax aspects of domestic and international business transactions and... | Read More
Mr. Browne advises clients on the U.S. income tax aspects of domestic and international business transactions and matters involving federal, state and foreign taxes. With more than 35 years of experience, he handles complicated tax and financing issues for a diverse range of clients. He has experience advising sellers and purchasers on tax aspects of business acquisitions involving both strategic and financial purchasers, preparing tax disclosures for debt and equity offering documents, advising clients on tax aspects of forming, funding, and reorganizing corporate and partnership entities, and advising clients on tax and financing aspects of international operations.Close
Lawrence K.Y. Pon, CPA/PFS, CFP, EA, USTCP, AEP
Pon & Associates
Mr. Pon has been in practice since 1986 providing comprehensive tax and financial planning, tax preparation and... | Read More
Mr. Pon has been in practice since 1986 providing comprehensive tax and financial planning, tax preparation and representation.Close