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How is an LLC taxed?

Entity Classification Election Filing Service

The Limited Liability Company (LLC) entity type is flexible on how it can pay taxes to the federal government. It can pay taxes like a Sole Proprietorship, a Partnership, a Corporation, or even like an S-Corporation. With Sole Proprietorships, Partnerships, and S-Corporations, business income is taxes as the personal income of the owners. With a Corporation, the Corporation itself pays taxes on its income, and additionally, the owners are taxed on income they take from the Corporation. The Entity Classification Election is the filing an LLC makes to tell the IRS how it wishes to be taxed.

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