How to get paid from your LLC (multiple scenarios)

[@kelsieedwards405]

So happy I found this channel. My husband and I are starting our own business, and with both of us having limited knowledge with regard to taxes and the IRS, Hector has been a life-saver for me as the bookkeeper of the business.

[@HectorGarciaCPA]

Great to hear!

[@stephaniepena7362]

Thank you so much Mr. Garcia, I started my bookkeeping company last year. This is very helpful for me as a business owner, but the more knowledge I have I can help my clients ask the proper questions to their CPAs to help them get the most out of their company.

[@susanrosegale6646]

Your channel is excellent! I am a trained 30 year accountant (not a CPA) and am now doing bookkeeping for my son and church. QBO brought me here, but this topic is helping me with my son's business. Thank you for your great presentations!

[@HectorGarciaCPA]

Great!

[@charliefox3157]

Thank you for the video Hector, I am "helping" a friend get started with an LLC and this has been great information.

[@henocktube]

This is such a great video and though as you said, accounting is hard, you made this so much easier to understand. Very well done! Very easy to understand.

[@HectorGarciaCPA]

:)

[@katenguyen0107]

Love that you're so thorough with the info!! Thanks a lot!!

[@HectorGarciaCPA]

Glad you like it

[@georgekennedy1886]

Great video, Hector. It was extremely enlightening. Thanks.

[@HectorGarciaCPA]

Thanks, glad you found value in it

[@DianeDesignGifts.]

Thank you Hector for this informative lesson! You know you stuff! I wish I had you as my advisor for me just starting my new 2022 business. God bless you for sharing ALL your valuable information. Thank you again!

[@HectorGarciaCPA]

You have me.. all you need to do us subscribe LOL… i have s lot of content here

[@DianeDesignGifts.]

@@HectorGarciaCPA Thanks Hector 👍 I am a new sub! Thanks again , you're the best informative CPA out there!

[@MaryAnnRobertson-e1x]

Great information. Thank you for your videos.

[@HectorGarciaCPA]

Glad you like them

[@landmaster23]

Thank you for this session, from -10 F Chicago today, Can you do a session on Sale of Rental house?

[@HectorGarciaCPA]

I did.. there is a video on that

[@chabaerdos775]

Awesome job! Thank you so much for walking us through this subject. Great video, as always!

[@HectorGarciaCPA]

You welcome

[@lilyrincon3272]

Thank you so much for all the info you share with us. God bless you!

[@ronnies6811]

Thanks so much for all your informative videos, Hector!

[@carolsles]

The greatest video in 2022 !!!!!! Explained well and very detail !! Thanks for making this and wanna seee more this type of accounting concept video than QB video thanks Hector. =)

[@angelinacano8454]

Great video!! I learned a lot today and you explained it so easy. Thank you!!!

[@HectorGarciaCPA]

That’s great

[@NS-ef2ix]

Excellent explanations. Thank you!

[@evafranco7888]

That was a great video!

[@Ace_r89]

Thanks for the guidance Hector!!!

[@HectorGarciaCPA]

:)

[@ashishnanda2051]

Thanks a lot Hector for this informative session. What if an MMLLC has a loss? Do we need to distribute the loss among the members, if yes, is it going to affect their initial capital contribution? Does the LLC still need to issue form K-1?

[@HectorGarciaCPA]

Yes of course, you need to file a 1065 with the K-1s for sure

[@WildernessMindset]

if real estate is passive income and does not apply for self-employment tax, does other passive income not require self-employment tax too? I'm a filmmaker who receives royalties from my films, some of which were released years ago but they still produce a passive income.

[@HectorGarciaCPA]

Royalty is passive as well.

[@vivekshetty1000]

This is a great resource for LLC owners. A a single member LLC owner, can I pay taxes on the profits via regular yearly tax returns or do I need to pay only quarterly 4 times in year? Thank you in advance for the answer

[@HectorGarciaCPA]

Correct: 4 estimated payments

[@KCsingingjourney]

If I am the only owner, with employee, can I elect to be taxed as an S corporation?

[@mizzkhaeya7819]

Does commission for a certain partner for getting clients can be considered as guaranteed payment in MMLLC?

[@HectorGarciaCPA]

Likely

[@KCsingingjourney]

So Hector if I take all the profit out of the business as Owner's Draw as a payment to me, I'm still making taxes on the profit, correct?

[@mariamcgrath1247]

Hector, If we have a single member LLC for 20 years taxes as a single member and then we change to be taxes as an S-Corp, how does the Capital account work - do we need to track back the 20 years and see how much the owner out in to the business or does it start form the year it is changed to be taxed as an S-Corp?

[@HectorGarciaCPA]

I use the mathematical difference between assets and liabilities to determine the capital

[@KCsingingjourney]

Can I do a "Guaranteed Payment" as a SMLLC? Is this considered a business deduction?

[@hildasuarez8755]

Can I get a discount code for quick books?

[@HectorGarciaCPA]

Desktop or Online?

[@ritaspartyrentals6845]

Thank you so much Hector for the detailed explanation. Which Payroll Company would you recommend? Do you know if the cost is pretty much the same for all, or could it vary depending on the company?

[@HectorGarciaCPA]

QuickBooks Online Payroll is the easiest to work with. ADP is most robust in terms of services

[@ritaspartyrentals6845]

Thank you 👌

[@marvelouss719]

@@HectorGarciaCPA Agreed.

[@AugieCruz]

What about spouse LLCs?

[@HectorGarciaCPA]

I would say the same rules

[@jonreeves3993]

if i elect to be taxed as scorp, does the llc still need to pay estimated taxes quarterly?

[@HectorGarciaCPA]

No, the individual would need to pay taxes via payroll or via estimated tax

[@chriscoronel2635]

Thank you very much I agree with everything stated

[@eloyavelar8257]

Question so for example if an SMLLC invested 50k at the beginning of a year and 6 months into the business he exhausted his investment by owner draws, at what point will his draws be taxed?

[@HectorGarciaCPA]

Draws are only taxed if he he draws exceeds the capital. Capital = Initial investment + Net Taxable Income - draws… So to answer your question, we would need to know what the income is.

[@eloyavelar8257]

This is only an example, let's say at the middle of the year 2021 SMLLC invested 10K, after several draws for the remaining of the year he exhausted the 10k plus he has 35 k in draws, will only the 35 k be taxable?

[@HectorGarciaCPA]

@@eloyavelar8257 if they had 35k in profits; then yes $35k is taxable as business income. If they had 20K in profits then $20k is taxable as business income and $15k might be taxable as a capital gain (if they took out non-recourse loans like an unforgiven PPP loan or an SBA EIDL loan under $200k)

[@eloyavelar8257]

Muchas Gracias!

[@eloyavelar8257]

Hello, how would you categorize an estimated tax payment via EFTPS when it comes through the bank fee in QBO, will it be a tax expense?

[@karinatorres170]

I have a question. Our bookkeeping is not the best at all. We use quick books. My question is can a bookkeeper or accountant still help us? My husband fell into deep depression and just didn’t keep up with anything except the taxes we are required to pay. I was mostly at the shop doing all the sales and helping customers through out this time. All I know is that our square account we use is connected to Quickbooks. I know nothing about bookkeeping and my husband hardly does either.

[@HectorGarciaCPA]

A bookkeeper should be able to help

[@karinatorres170]

@@HectorGarciaCPA thank you Hector. I watched some of your videos and I somewhat understand what is going on but at this point it is too confusing for me

[@wisdomdjam9984]

I have been following your KZbin videos and found them to be very resourceful . Thanks very much. MY question is as a beginner providing online accounting and bookkeeping services remotely, what infrastructure service or working tools will you recommended to use. eg, accessing information from clients remotely? Thanks very much

[@HectorGarciaCPA]

By far, the easiest is working with QuickBooks Online. And then have some sort of document sharing platform like DropBox to have access to bank statements and receipts..

[@doykme]

Hi Hector thank you for such a great information you provided us. One question can a Single member LLC can open a business in other State?

[@HectorGarciaCPA]

Yes

[@doykme]

The business is related ( construction) it is necessary to open it or we might be able to use the same business information?

[@tannertucker22]

Thank you Hector. If the. LLCs profits flow throw to the members 1040 via a k1 why would any owners draw be taxed? The LLC s income is already fully taxed on the members 1040. If the draw is taxed , the member would in be taxed twice just as with a c corp. what I a missing? Thank you.

[@HectorGarciaCPA]

You are not missing anything… but if you take more Draws than your capital; that mathematically means you are taking debt on your LLC to fund your personal lifestyle (draws)

[@utleyadmin9679]

I wish you were my dad Hector! We would be rich as hell. I am advanced in digital sales systems and a high-risk investor. I have a Fleet of car haulers as an LLC and that LLC is owned by an S-Corp operating as a small business accounting company. I need a 24-hour manager that I completely submit to for financial instruction

[@HectorGarciaCPA]

:)

[@royolivarez2749]

When Paying myself under Owners Draw, for the Account Type does it fall under Equity or Expense?

[@HectorGarciaCPA]

Equity 100%

[@royolivarez2749]

@@HectorGarciaCPA Thank you!

[@Resa_Grace]

Hector, I’m in Florida and I filed as a corporation for my brand new business last week and I put my husband on it as VP. How do convert that to an LLC in only MY name?! I don't want to lose my biz name but I made a mistake doing it as an inc from the start. It definitely needs to be an LLC. Help?

[@HectorGarciaCPA]

There is a form to convert.. but wondering why are you choosing LLC vs. Corp?

[@Resa_Grace]

@@HectorGarciaCPA it’s just a home based plant nursery, with no employees. It seems as though I’d need the protection that comes with the LLC?

[@HectorGarciaCPA]

@@Resa_Grace corp affords legal protection as well.

[@inescurbelo4764]

Thank you a really good video, I have a question a person with a ITIN number that own a Corporation is considered as foreing individual? The Corp should withhold tax?

[@HectorGarciaCPA]

Corp should without 30% on dividends

[@mac_vegas7026]

When you start a business, all the cash you put into your company is capital invested? Including equipment? So Basically when your paying yourself it’s considered getting your “money invested” back? Also, since it’s not an “Owners Draw,” what is be the name for this type of payment?

[@HectorGarciaCPA]

Correct

[@ERive33]

Thanks for the video Hector! I learned alot from it but,, What happens if taxes were not paid during the year, how much would i be fined for not filing the estimated taxes?

[@HectorGarciaCPA]

Around 3% interest rate

[@ERive33]

@@HectorGarciaCPA Thank you again!

[@SD-rg5mj]

Hello and thank you very much, could you recommend an article for me to read and tell you that I have a lot of trouble understanding English and in particular administrative English In any case you are talking about my problem here since I have an llc which is registered in the wayoming but I do not know how can I pay myself, I am a tax resident in France Thanks Cyril

[@nickj1358]

Looking for a CPA to help make sure I pay my children correctly from my family management company. Is this something you can help with?

[@HectorGarciaCPA]

Not my area of expertise

[@yosleineperez8276]

Thanks

[@saikatbiswas1620]

Easy way to understand.

[@HectorGarciaCPA]

Awesome

[@HectorGarciaCPA]

:)

[@jeimyamador6647]

Hola buenas tardes . Como me podria poner en concataco cm ust . Tengo una LLC y estoy tratando de enternderle al Quickbok creo que anteriro mente en sus videos habia añgunso cursos disponibles . ?? Me gustaria contactarme cm ust . Muchas gracias .

[@HectorGarciaCPA]

Llama a la oficina 954-414-1524 para hacer una cita.

[@yvonnegtz1100]

You are a great this craziness awesome... thank you

[@ergunoz1857]

Well, everything was explained well but the only thing you missed here is to show how to calculate the tax liability of MMLLC S Corp tax liability? In my opinion, that is the most important part of the video but unfortunately, you did not explain it

[@ingridsolano3336]

Unfortunately this didn't help ; ;

[@HectorGarciaCPA]

What question was left unanswered?

[@ericeandco]

Basically how you take money (pay yourself) out of your llc depends on the kind of llc you are. Other than a single member llc it starts to get complicated. You have follow the rules for the type of llc you are. If you’re a multi member llc you default to partnership status and follow partnership rules. If you elect to be treated as an S or C Corp you follow those rules. If you’re in the situation where you need to file partnership or corporate returns it’s worth finding a good cpa or enrolled agent to help you out in my opinion.

[@HectorGarciaCPA]

@@ericeandco agreed