This course provides an in-depth comparative analysis of Limited Liability Companies (LLCs) and S Corporations, focusing on their tax implications, compliance requirements, and operational structures. Participants will explore key aspects of entity formation, tax treatment, and compliance with corporate formalities. Topics include electing Subchapter S status, mechanics of Form 2553, and relief options for late filings under Rev. Proc. 2022-19. The course also highlights entity-specific tax forms, accountable plans, taxable fringe benefits, officer reasonable compensation, estate planning, business continuation planning, and audit strategies. Additionally, participants will review Schedules K-1, K-2, K-3, and effectively connected income for both entity types. *Please Note: If you need credit reported to the IRS for this IRS approved program, please download the IRS CE request form on the Course Materials Tab and submit to kori.herrera@acpen.com
Learning Objectives
Compare and contrast LLCs and S Corporations to determine suitability for various clients. Provide a general overview of LLC structures and their tax implications. Discuss the interplay of LLCs and S Corporations with self-employment tax. Prepare Form 2553 for electing Subchapter S status and identify relief options for late filings. Analyze Rev. Proc. 2022-19 and Rev. Proc. 2023-3, and understand their differences and applications under I.R.C. §1361 and §1362. Identify and address S Corporation eligibility errors and implement corrective measures. Review corporate governance procedures and compliance requirements for LLCs and S Corporations. Examine shareholder stock and debt basis for S Corporations. Highlight key aspects of Forms 1120S, 1065, and related schedules (K-1, K-2, K-3). Discuss officer reasonable compensation and general partner guaranteed payment requirements. Apply facts and circumstances in advisory services to determine reasonable compensation.
Major Topics
Comparative analysis of LLCs and S Corporations Entity formation, compliance, and operational structures Self-employment tax and its implications for LLCs and S Corporations Form 2553 preparation and relief for late filings Rev. Proc. 2022-19 and Rev. Proc. 2023-3: analysis and application S Corporation eligibility errors and corrective measures Corporate governance and formalities for both entity types Shareholder stock and debt basis for S Corporations Forms 1120S, 1065, and related schedules (K-1, K-2, K-3) Officer reasonable compensation and general partner guaranteed payments Audit strategies, estate planning, and business continuation planning
