hcpa
Level 1
12-07-2019
09:41 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
I have an S Corporation that is looking into moving the assets to another llc for liability protection. The new LLC will have the same ownership as the S Corp. The sole purpose is to separate the operations from the assets for liability protection. Are there tax consequences for this?
Best Answer Click here
Labels
PhoebeRoberts
Level 11
12-07-2019
09:41 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
LLC taxed as what?
hcpa
Level 1
12-07-2019
09:41 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
S Corp
abctax55
Level 15
12-07-2019
09:42 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
The phrasing "S corp to *another* LLC is a bit confusing.
** IRonMaN ** is FREE 🙂
PhoebeRoberts
Level 11
12-07-2019
09:42 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
Have the company's attorney structure it as a spin-off type reorg. No tax consequence then.
hcpa
Level 1
12-07-2019
09:42 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
Can you elaborate on what a spin off type reorg means?
hcpa
Level 1
12-07-2019
09:42 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
Can you elaborate on what a spin off type reorg means?
PhoebeRoberts
Level 11
12-07-2019
09:42 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
It means "send your client to their business attorney to do a spin-off type reorg." It's not something you can accomplish.
https://www.thetaxadviser.com/issues/2019/may/structuring-divisive-reorganizations.html
https://www.thetaxadviser.com/issues/2019/may/structuring-divisive-reorganizations.html
abctax55
Level 15
12-07-2019
09:42 AM
- Mark as New
- Bookmark
- Subscribe
- Permalink
- Report Inappropriate Content
Assets moving out of a Corp are deemed sold at fair market value. Probably generating a gain...depending on depreciation taken.
** IRonMaN ** is FREE 🙂