What Does Limited Liability Company on a W-9 Tax Form Mean?
Form W-9 is a form for someone to request a taxpayer identification number and certification from a place of business. This form is not filed with the Internal Revenue Service, but is returned to the person requesting the taxpayer identification number and certification.
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Business Type
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Form W-9 allows for several classifications of businesses. These classifications include sole proprietor, corporation, partnership, or limited liability company.
Limited Liability Company Defined
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Limited liability companies are a state classification allowable under state laws. They have the limited liability of a corporation but also allow pass-through distributions to reduce double taxation like a partnership.
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How an Limited Liability Companies May File
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Limited liability companies may choose to file as either a sole proprietorship, partnership or a corporation. Form 8832 allows a limited liability company to choose the type of business entity to which it will file taxes.
Tax Classification
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On Form W-9, the taxpayer must check the appropriate entity in which the limited liability company files its taxes. This information is available from the limited liability company when the taxpayer requests his identification number and certification.
Date of Election
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The taxpayer must choose the proper classification of the limited liability as of the date of election. This is the date the limited liability company is officially recognized as its chosen business entity type.
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References
- Photo Credit A young woman holding a pen, doing her taxes image by Christopher Meder from Fotolia.com
