by Richard Keyt, LL.M. (federal income taxation), New York University School of Law, U.S. Tax Attorney
I recommend that the owners of all LLCs I form hire A+ Tax Service, LLC (“ATS”), to provide bookkeeping services for the LLC and prepare U.S. federal and state income tax returns for the LLC (only if it is owned by two or more investors) and all of the LLC’s owners. ATS is a Phoenix, Arizona, based bookkeeping and U.S. tax return preparation business owned by Cindy Dillard. The company is located 3593 W. Northern Ave., Suite 12, Phoenix, AZ 85051. Its phone number is (602) 589-6007, fax number is (602) 589-6008 and email address is email@example.com. ATS prepares thousands of tax returns each year, including hundreds of 1040NR tax returns for non-U.S. citizens.
U.S. Tax Returns for People. If you are a non-U.S. person who owns rental real estate in the U.S. you must prepare and file IRS Form 1040NR if you or your company rented real property in the United States or engaged in a trade or business during the preceding year. You must file the return even if:
a. You have no income from a trade or business conducted in the United States,
b. You have no U.S. source income, or
c. Your income is exempt from U.S. tax under a tax treaty or any section of the Internal Revenue Code.
The IRS Form 1040NR is an annual return due not later than June 15th of each year unless the taxpayer obtains an extension to file after that date.
U.S. Tax Returns for Companies. Every U.S. limited liability company that has two or more owners (LLC owners are called members) must prepare and file an IRS Form 1065 (a partnership tax return) on or before April 15th of each year unless the LLC neither receives income nor incurs any expenditures treated as deductions or credits for federal income tax purposes. LLC’s taxed as partnerships remain an LLC under state law, but are taxed by U.S. tax law as partnerships unless the LLC elects to be taxed as a C corporation (this would be a big mistake for an LLC that owns investment real estate) or an S corporation (not possible if any owner is a non-U.S. citizen).
A U.S. LLC that has one or more owners who is a non-U.S. citizen or an entity can be taxed under federal income tax law one of two ways:
1. Single Member LLCs: If the LLC has only one owner the default IRS method of federal income taxation is “sole proprietorship or disregarded entity.” If your LLC will have only one member it does not file a separate U.S. income tax return for the company. The only tax return needed is the IRS Form 1040NR filed by the owner.
2. Multimember LLCs: If the LLC has two or more owners the default IRS method of federal income taxation is the partnership method. LLCs taxed as partnerships must file an IRS Form 1065. Each owner is given an IRS Form K-1 that contains the information needed by the owner to file his or her IRS Form 1040NR. Each owner/member must then file an IRS Form 1040NR on which the member reports the items reflected on the Form K-1. A two member LLC, including one that is owned by a husband and wife will require 3 US tax returns – one IRS Form 1065 for the LLC and one IRS Form 1040NR for each spouse.
ATS’ Services & Fees
ATS’ fees for and a description of its professional services are listed below.
$597 Personal U.S. & State Tax Return Preparation Service: Preparation of one U.S. income tax return for a nonresident alien and spouse filing jointly (IRS Form 1040NR) and one state income tax return if the LLC has income generated in a state that has a state income tax. This service includes one annual tax planning phone call (you call us), unlimited emails, and a review & analysis of your prior year’s 1040NR (if you have one). If your LLC is a single member LLC taxed as a sole proprietor we also prepare 1040NR schedules A, C and E (for one property). If your LLC owns more than one rental property there is an additional fee of $150 for each additional rental property because we must prepare a Schedule E for each property.
$597 Business U.S. & State Tax Return Preparation Service: Preparation of one U.S. income tax return for an LLC taxed as a partnership (IRS Form 1065) and one corresponding state income tax return if the LLC has income generated in a state that has a state income tax. This service includes one annual tax planning phone call (you call us), unlimited emails, and a review & analysis of your prior year’s 1040NR (if you have one). If your LLC owns more than one rental property there is an additional fee of $150 for each additional rental property because we must prepare a Schedule for each property.
$397 Each Additional Business U.S. & State Tax Return Preparation Service: If we prepare one business tax return for a year for your LLC then we will prepare an additional U.S. income tax return for another LLC taxed as a partnership (IRS Form 1065) and one corresponding state income tax return if the LLC has income generated in a state that has a state income tax. Each additional business return is $397 plus $150 for each property if the LLC owns more than one rental property.
$347 Bookkeeping Service: We setup your books using Quickbooks online. We also will enter income and expenses into your Quickbooks every month for one LLC for a monthly fee of $297 payable in advance. ATS will add you to its subscription system and automatically charge your credit card every month.
Form more information about ATS’ bookkeeping and tax return preparation services contact Cindy Dillard, the owner of ATS at: phone – (602) 589-6007; fax – (602) 589-6008 or email to firstname.lastname@example.org.