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EIN for payroll different than EIN for C-Corporation

ddoggy
Level 2

A new client's W3 is under a different EIN than the corporation's EIN. When I asked why the numbers didn't match, he said that the payroll is under an LLC pass through entity. Has anyone ever experienced this? Last year's tax return included the payroll in the 1120 tax return.

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6 Comments 6
IRonMaN
Level 15

Were the checks actually written by the corporation or the LLC?  Dealing with tax clients is like bringing back old Art Linkletter TV shows --------"Clients say the Darndest Things".

 


Slava Ukraini!
ddoggy
Level 2

I assume by the LLC since the W2s are all from the LLC

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IRonMaN
Level 15

Assume is a very dangerous word in the world of tax.


Slava Ukraini!
ddoggy
Level 2

It was run under the LLC, his prior accountant advised him to do it this way for liability reasons...I advised him to run it under the Corp going forward. 

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IRonMaN
Level 15

Then it wouldn't be shown as wages on the corporate return.


Slava Ukraini!
dkh
Level 15

I know of a similar situation....the LLC for processing payroll was done to take advantage of Amish employees with F4029s.   LLC members had  F4029s (SSExempt approval for Religious reasons) thereby any employees with the approved F4029s did not have SS/Medicare w/held.    The LLC then charged the SCorp for leased employees.   Saved the SCorp lots of payroll taxes.

BTW -  don't forget to file that LLC return.