Impact of EIN on taxation
"Is it possible if (After getting EIN) I change my LLC type   (disregarded entity or C type or S type or corporation or change in   number of members) for tax saving ? You marked your question as ""real-estate"", so I'm guessing you're holding rental properties in your LLC. That means that you will not be able to qualify for S-Corp, only C-Corp treatment. That in turn means that you'll be subject to double taxation and corporate tax rate. I fail to see what tax savings you're expecting in this situation. But yes, you can do it, if you so wish. I suggest you talk to a licensed tax adviser (EA/CPA licensed in your State) before you make any changes, because it will be nearly impossible to reverse the check-the-box election once made (for at least 5 years)." Your question mixes up different things.  Your LLC business type is determined by how you organize your business at the state level.  Separately, you can also elect to be treated in one of several different status for federal taxation. (Often this automatically changes your tax status at the state level too, but you need to check that with your state tax authority.) It is true that once you have an EIN, you can apply to be taxed as a C Corp or S Corp.  Whether or not that will result in tax savings will depend on the details of your business.  We won't be able to answer that for you.  You should get a professional advisor if you need help making that determination.
The question seems to be from the point of view actual sales and not its impact on one's taxation. In case you just want to sell, why brokers will respond differently each times. Either there may be issues with ownership and/or the company whose shares it is? In case you feel that the issues lies with brok "Those are just a form of ""rent tax"" on real economy - that is, people that work in those non-productive sectors of economy are just using the fruits of labor of all the others.   But only the real economy actually matters - and having a few extra zeroes in the bank accounts of the rich don't really affect it as long as those money stay there.  Money that are not exchanged for real world goods and services don't really exist for the real economy." The regulations you're talking about (TR 1.263) are going into effect starting tax year 2016, so for purchases you made last year they're (kindof...) irrelevant. Kindof, because the IRS promises to not audit those that qualify under the regulations even if they use it before it goes into effect, but it doesn't legally have to. Since the regulations are new, I suggest you talk to a licensed professional who'd explain them to you and interpret them with regards to your specific situation. From my brief read, you can expense under these rules things that you would otherwise capitalize, with the $500 limit to the invoice. Meaning, if you bought a computer paying $500, which you use 50% for your business - you can expense $250. The benefit, comparing to the Sec. 179, is that you're not limited to new items, nor are you limited to business revenue. Otherwise, it looks like the applicability is similar. As I said - talk  to a licensed tax adviser (EA/CPA licensed in your State), since these rules are new and untested, and you should probably have a professional provide guidance. I'm not such a professional. "Yes, this is a miscellaneous itemized deduction. https://www.irs.gov/publications/p529/ar02.html For this to impact your taxes, you have to be itemizing deductions (have total deductions greater than standard deduction), and the total of all miscellaneous deductions needs to exceed the ""2% floor"" described in the IRS link above." It looks like fair-market value when you receive your virtual currency is counted as income. And you're also subject to self-employment tax on that income. Here's an FAQ from the IRS: Q-8: Does a taxpayer who “mines” virtual currency (for example, uses   computer resources to validate Bitcoin transactions and maintain the   public Bitcoin transaction ledger) realize gross income upon receipt   of the virtual currency resulting from those activities? A-8: Yes,   when a taxpayer successfully “mines” virtual currency, the fair market   value of the virtual currency as of the date of receipt is includible   in gross income. See Publication 525, Taxable and Nontaxable Income,   for more information on taxable income.Q-9: Is an individual who   “mines” virtual currency as a trade or business subject to   self-employment tax on the income derived from those activities? A-9:   If a taxpayer’s “mining” of virtual currency constitutes a trade or   business, and the “mining” activity is not undertaken by the taxpayer   as an employee, the net earnings from self-employment (generally,   gross income derived from carrying on a trade or business less   allowable deductions) resulting from those activities constitute   selfemployment income and are subject to the self-employment tax. See   Chapter 10 of Publication 334, Tax Guide for Small Business, for more   information on selfemployment tax and Publication 535, Business   Expenses, for more information on determining whether expenses are   from a business activity carried on to make a profit. You'd of course be able to offset that income with the expense of mining the virtual currency, depreciation of dedicated mining equipment, electricity, not sure what else. Edit: Here's a good resource on filing taxes with Bitcoin: Filling in the 1040 Income from Bitcoins and all crypto-currencies is   declared as either capital gains income or ordinary income, for   example from mining. Income Ordinary income will be declared on either   your 1040 (line 21 - Other Income) for an individual, or within your   Schedule C, if you are self-employed or have sole-proprietor business.   Capital Gains Capital gains income, or losses, are declared on   Schedule D. Since there are no reported 1099 forms from Bitcoin   exchanges, you will need to include your totals with Box C checked for   short-term gains, and with Box F checked for long-term gains. Interesting notes from that article, your first example could actually be trickier than expected if you started mining before there was a Monero to USD exchange. Also, there can also be capital gains implications from using your virtual currency to buy goods, which sounds like a pain to keep track of. Just from my own experience (I am not an accountant): In addition to counting as 'business income' (1040 line 12 [1]) your $3000 (or whatever) will be subject to ~15% self-employment tax, on Schedule SE.  This carries to your 1040 line ~57, which is after all your 'adjustments to income', exemptions, and deductions - so, those don't reduce it.  Half of the 15% is deductible on line ~27, if you have enough taxable income for it to matter; but, in any case, you will owe at least 1/2 of the 15%, on top of your regular income tax. Your husband could deduct this payment as a business expense on Schedule C; but, if (AIUI) he will have a loss already, he'll get no benefit from this in the current year.   If you do count this as income to you, it will be FICA income; so, it will be credited to your Social Security account. Things outside my experience that might bear looking into:  I suspect the IRS has criteria to determine whether spousal payments are legit, or just gaming the tax system.  Even if your husband can't 'use' the loss this year, he may be able to apply it in the future, when/if he has net business income. [1] NB: Any tax form line numbers are as of the last I looked - they may be off by one or two. "Not sure I understood, so I'll summarize what I think I read: You got scholarship X, paid tuition Y < X, and you got 1098T to report these numbers. You're asking whether you need to pay taxes on (X-Y) that you end up with as income. The answer is: of course. You can have even lower tax liability if you don't include the numbers on W2, right? So why doesn't it occur to you to ask ""if I don't include W2 in the software, it comes up with a smaller tax - do I need to include it?""?" IRS Publication 463 is a great resource to help you understand what you can and can't deduct.  It's not a yes/no question, it depends on the exact company use, other use, and contemporaneous record keeping. Whether you're self-employed or not, knowing exactly how much tax you will pay is not always an easy task.  Various actions you can take (e.g., charitable donations, IRA contributions, selling stocks) may increase or reduce your tax liability. One tool I've found useful for estimating federal taxes is the Excel 1040 spreadsheet.  This is a spreadsheet version of the income tax return form.  It is not official and is not created by the IRS, but is maintained as a labor of love by a private individual.  In practice, however, it is pretty much an accurate implementation of the tax calculation algorithms encoded in the tax forms and instructions. The nice thing about it is that it's a spreadsheet.  You can plug numbers into various slots in the spreadsheet and see how they affect your federal tax liability.  (You may also owe state taxes depending on what state you live in.)  Of course, the estimates you get by doing this are only (at most) as accurate as your estimates of the various numbers you plug in.  Still, I think it's a free and useful way to get a ballpark estimate of your tax liability based on numbers that you can more easily estimate (e.g., how much money you expect to earn). "People often have the wrong idea about how taxes apply to their money.  There's not really any such thing as ""pre-tax"" or ""post-tax"" income, only pre-tax and post-tax **uses** of your income.  This is somewhat hidden by the fact that we pay income tax based on our income for the year; but if you look a bit closer, you'll notice that come April 15th, (almost) every dollar you get to *subtract* from your gross income isn't defined by where it comes from, but rather, where it *went* (there are a few special cases there, like qualified dividends, that that's an entirely different issue).  Perhaps the most clear example of this is a traditional IRA that you self-fund from your savings account on April 14th, for the prior tax year - You're putting dollars you've already taken home, into a pre-tax account, *after* the end of the calendar tax-year; and yet it all works out exactly the same (tax-liability wise - There's certainly an opportunity cost there) as if you had contributed those dollars via a weekly payroll deduction.  So when you manually fund a Roth IRA, it has *no* effect on your tax liability (except insofar as you *don't* get to deduct it from your taxable income, which you wouldn't if you had left it in a savings account, etiher).  In the year you earned that money, you paid taxes on it; when you take it out, you won't." I'm not sure why you think that it matters that the distribution goes to an S-Corp vs an individual tax payer. You seem to think it has any relevance to your question, but it doesn't. It only confuses your readers. The situation is like this: LLC X is deriving income in State #2. It has two members (I and S) residents of State #1. Members I and S pay all their taxes to State #1, and don't pay taxes to State #2. State #2 audited member I and that member now needs to pay back taxes and penalties to State #2 on income derived from that State. Your question: Does that mean that member S should be worried, since that member was essentially doing the exact same thing as member I? My answer: Yes. "IRA distributions are reported on line 15b on the standard form 1040.  That is in the same Income section as most of your other income (including that 1099 income and W2 income, etc.).  Its income is included in the Line 22 ""Total Income"", from which the Personal Exemption (calculated on 6d, subtracted from the total in line 42) and the Standard Deduction (line 40 - also Itemized Deduction total would be here) are later reduced to arrive at Line 43, ""Taxable Income"". As such, yes, he might owe only the 10% penalty (which is reported on line 59, and you do not reduce this by the deductions, as you surmised)." "my taxable income was roughly $230,000 in 2012. Indeed it is relevant. The highest AGI limit for deductible IRA contributions is 112K. So no, IRA contribution will not help you reducing your tax bill this year. The deduction phases out starting from AGI limits of $10K in certain cases (for married filing separately), and phases out entirely for anyone at AGI of 112K (for 2012). The table linked describes the various deduction phase-out parameters depending on your filing status, and will probably be updated yearly by the IRS. However this is only relevant if your company provides a retirement plan, as Joe mentioned. If your company doesn't provide a retirement plan but your spouse's does - then the AGI phase-out limit is $178K. If neither you nor your spouse (if you have one) is covered - then there's no AGI limit, and you can indeed make an IRA contribution before April 15th that would be attributed to the previous year and reduce your tax bill. Note that ""provides"" means the plan is available, even if you don't participate in it, any time during the year." "What kind of ""deductions"" are you talking about? Many deductions, like the standard/itemized deductions, come after the AGI, and do not affect the AGI, so I don't see how this would make any difference. Maybe you are talking about deductions that come before the AGI? If you want to increase your AGI legitimately, here's a way: Every year, itemize deductions on your federal return, and over-withhold your state income tax (assuming your state has income tax) by a lot, and/or make voluntary extra payments to your state income tax. As a result, you will get a huge refund on your state taxes the following year. Then you will need to include this refund as income on line 10 of the federal return that year, which will be included in the AGI. (Of course, you will also be able to deduct a lot of state income tax paid every year in the federal itemized deductions, but those come after the AGI.)" While you are required to do so as others have said, it's actually in your interest to do so. In a recent article at GlobeInvestor, Tim Cestnick discusses the benefits of filing tax returns for teens. This situation may or may not apply to you but the message is the same. The main benefits are (1) create RRSP contribution room and (2) be eligible for GST/HST credits and other possible one-shot credits (think oil royalty surplus cheques in Alberta). Excerpt: You see, when Lincoln was 14, he filed a tax return and reported $2,000 of income that year. He paid no tax thanks to the basic personal tax credit, but he created $360 of RRSP contribution room that year. Beginning in 2003, Lincoln started working part-time in his father's business. His father agreed to pay him $6,000 each summer to work in the business, to help save money for university. Lincoln didn't pay any tax on the money he earned in those summers because his basic personal tax credit was always higher than his earnings. In addition, Lincoln added to his RRSP contribution room simply by filing a tax return each year.