David Schwartz, you still choose not to understand that I was merely trying to help SOMEONE ELSE on the ease and process of LLCs. I didn't lecture anyone on I/T tax issues. And I'm resisting the urge to lecture you on manners and propriety. You definitely have it coming. I know you're scared and angry about the tax code and from what you say, I don't blame you. The IRS has always been a monstrous and unnecessary evil anyway. If you stop cavilling about me and focus on your grievance, you will educate people much better. Including me - and some years ago I spent some time on the lower rungs of I/T. And BTW, I'm posting from and to PLUG, which is certainly not "primarily" for anyone but Linux users in the Phoenix area. So please take that bull to a different china shop. My advice for those who won't hire you? Well.... LLCs can be members of other LLCs. I believe they can also be members of C and S corps. If so, you might look into banding together with some other contractors and hiring out as the new meta-corp. (You could just band together anyway.) Just a thought. And remember: you asked. - Vara - www.facebook.com/vara.lafey On Dec 8, 2016 5:10 PM, "David Schwartz" wrote: > This thread IS about my original grievance — Sec. 1706 of the Tax Code > > It says so right there in the Subject line. > > You’re a real estate professional lecturing computer consultants on stuff > that works nicely in the real estate profession. > > It can be harmful in THIS profession. Because of 1706. Which has nothing > to do with either LLCs or Real Estate. > > But there ARE companies who WILL NOT HIRE SINGLE-MEMBER LLC’S AS > CONTRACTORS for gigs in computer-related high-tech gigs. > > I’m not aware that situation exists in real estate. Are you? > > What advice do you have for those of us who have LLCs and someone will > only hire us as contractors if we’re either a C or S Corp? > > THAT is the topic at hand. It’s irrelevant how simple it is to set up LLCs > if people won’t hire your LLC. > > If that was the case in real estate, you probably wouldn’t be using them, > right? > > -David "The Tool Wiz" Schwartz > > > > On Dec 8, 2016, at 6:48 PM, Vara La Fey wrote: > > I was clarifying generalized things for the poster who mentioned LLC as a > suggestion from his accountant. > > Was that poster you?? Then you're welcome. Was it someone else?? Then > correct my errors or kindly stick to your original grievance. > > - Vara > - www.facebook.com/vara.lafey > > On Dec 8, 2016 4:39 PM, "David Schwartz" > wrote: > >> I’m not sure what the point of these “Rah Rah for LLC!” posts is all >> about. Nobody has said anything to the contrary. >> >> This list is primarily for people who work in the "high tech" (i.e., >> computing) industry, which is SPECIFICALLY what Sec. 1706 of the Tax Code >> deals with. >> >> If you’re in Real Estate, Accounting, Architecture, or whatever, 1706 >> does not apply to you. It’s very, VERY NARROW in its applicability — BY >> DESIGN. >> >> Sec. 1706 eliminates the “safe harbor” provisions for people who work as >> contractors, eliminating any “benefit of the doubt” that is historically >> given in most other professions, and instead subjects workers and the >> companies that employ them to a vague 22-point (IIRC) series of questions >> that an IRS Auditor can use to establish whether someone should be (or >> should have been) regarded as a “contractor” or “employee” for tax purposes. >> >> The problem is, this is not something that is adjudicated when you hire >> on, and it does not matter how many reams of paperwork you sign that says >> it’s one thing or the other. >> >> It’s a ticking time-bomb that applies in the vast majority of cases 3-5 >> years AFTER THE FACT when the person — usually hired as a contract worker >> at the time — is audited by the IRS for whatever reason, and the auditor >> reviews one of his employment situations and subjects it to the 22-point >> “test”. If he rules the person was acting as a “contractor”, all is fine. >> >> But if he rules the person should have been treated as an “employee”, >> both the person and the erstwhile “employer” just got nuked. >> >> The back-due taxes assessed to the “employer", plus accrued penalties and >> interest, typically amount to far more than whatever the person was paid. >> The company has no knowledge anything went awry until they suddenly get a >> bill from the IRS. >> >> Meanwhile, the person in question now has to “unwind” any business >> expenses and deductions, as well as anything that depended on them such as >> retirement contributions, FICA/FUTA/UI set-asides, etc. Everything is >> up-ended and needs to be re-filed. >> >> And to add insult to injury, the same auditor is likely to flag previous >> and subsequent years for auditing as well, and what do you think he’s going >> to rule on other contract gigs that were fundamentally the same situations >> as the first one he nuked? >> >> Again, if you’re not in the high-tech industry, this does not apply to >> you. >> >> Having a single-member LLC stand-in to protect you against such >> situations can be helpful, IF the company you want to work with is willing >> to hire you. Many are not because of problems discussed in other threads. >> >> -David "The Tool Wiz" Schwartz >> >> >> >> On Dec 8, 2016, at 4:53 PM, Vara La Fey wrote: >> >> Yes, you can be the only user ("Manager" and "Member") of an LLC. I did >> it for years in real estate, and still have my LLC. >> >> IIRC the form takes more like 5 min. You publish your intended LLC in the >> Record Reporter for 6 weeks. I forget the cost, but it's fairly cheap and >> easy. And IIRC, the Sec of State office (or wherever I went) has a form for >> that too. >> >> LLCs are almost zero maintenance and are not sublect to hostile takeover. >> And so easy that some real estate investors create one for each property, >> just to keep properties legally isolated from each other for basic >> liability reasons. An LLC name like ", LLC" is one of >> those. (So named cause the investor realized that pretty names would be >> silly and confusing.) >> >> Good luck!! :-) >> >> - Vara >> - www.facebook.com/vara.lafey >> >> >> >> >> --------------------------------------------------- >> PLUG-discuss mailing list - PLUG-discuss@lists.phxlinux.org >> To subscribe, unsubscribe, or to change your mail settings: >> http://lists.phxlinux.org/mailman/listinfo/plug-discuss >> >> > --------------------------------------------------- > PLUG-discuss mailing list - PLUG-discuss@lists.phxlinux.org > To subscribe, unsubscribe, or to change your mail settings: > http://lists.phxlinux.org/mailman/listinfo/plug-discuss > > > > > --------------------------------------------------- > PLUG-discuss mailing list - PLUG-discuss@lists.phxlinux.org > To subscribe, unsubscribe, or to change your mail settings: > http://lists.phxlinux.org/mailman/listinfo/plug-discuss >