[WSBARP] single member to two-member LLC

[Robert Pampell]

Under the LLC Act, I think it is possible to conclude that the wife, as PR
and on behalf of the estate, becomes an assignee of H's interest, unless his
estate planning documents or the probate code provide otherwise.  H has
ceased to be a member of the LLC (technical term is "dissociation"). If W
wants to continue the LLC and elects within 90 days after the date of death
to do, she has the right to continue the LLC and become the sole remaining
member.  In that case, the LLC would have continued as a single member
entity for tax reporting purposes, and no new EIN should be required.  If
she does not elect within the 90 days, the LLC would be dissolved under RCW
25.15.265.

 

In a quick search, I did not find any IRS guidance on this, so I would check
with a knowledgeable CPA regarding the required tax reporting.

 

Bob Pampell

 

Robert Pampell, Attorney

21st Century Law Office (r)

19125 Northcreek Parkway, Suite 120

Bothell, WA 98011

voice: 425-329-2629
fax: 877-640-6403
cell: 425-501-4784
email:  <mailto:rpampell at swcp.com> rpampell at swcp.com

 <http://www.linkedin.com/in/robertpampell>
http://www.linkedin.com/in/robertpampell

 

 

From: wsbarp-bounces at lists.wsbarppt.com
[mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Richard Holland
Sent: Monday, November 20, 2017 11:54 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] single member to two-member LLC

 

I haven't seen any response to this, and I am definitely not a tax expert
but reasoning through it:  Isn't the reason the H&W are 'one' person for the
LLC because the marital community is a single thing?  If that's the case,
then you no longer have one 'thing'.  You have two.  You have Estate of H
(which presumably now only consists of his separate property) and W (who,
presumably now has all of the CP and her separate property).  That, to me,
would say it is a two 'thing' LLC and therefore must file - especially since
the Estate of H pulled its own EIN.  

 

That's a 'typing this while drinking coffee and procrastinating on starting
a project' response, so probably worth what you're paying for it.

 

 

Thanks,

 

Rich Holland

 <mailto:rich at pnwle.com> rich at pnwle.com

603 4th Avenue, Suite 100                                

Kirkland, WA 98033                                            

877.785.8734  / 866.982.5080 (fax)

 

BE AWARE!  Online banking fraud is on the rise.  If you receive an email
containing instructions on where or how much to send to our office, CALL TO
VERIFY prior to sending. ** WE DO NOT CHANGE OUR BANKING INSTRUCTIONS**

 

The information contained in this communication, and in any attached
document(s), is privileged and/or confidential, intended solely for the
individual/entity to whom/which it was sent.  If you are not the intended
recipient, you are hereby notified that any dissemination, distribution, or
copying of this information is strictly prohibited.  If you have received
this email in error, please notify me immediately at the email address,
mailing address, or telephone or fax number above.

 

 

 

From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
[mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Rod Harmon
Sent: Thursday, November 16, 2017 10:29 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com
<mailto:wsbarp at lists.wsbarppt.com> >
Subject: [WSBARP] single member to two-member LLC

 

An LLC in which H&W are the sole members is considered by the IRS to be a
single-member LLC and therefore a disregarded entity.  It does not need its
own EIN and it does not file its own tax return, but its activity is
reported on Schedule C of H&W's joint return.  But then H dies, his wife is
the PR of his estate, and his estate obtains an EIN.  Is the LLC now a
two-member LLC that must apply for its own EIN and file its own tax return?

 

Rod Harmon

 

RODNEY T. HARMON

       Attorney at Law

         P.O. Box 1066

      Bothell, WA   98041

     Tel:   (425) 402-7800

     Fax:  (425) 458-9096

     <http://www.rodharmon.com> www.rodharmon.com

    <mailto:rodharmon at msn.com> rodharmon at msn.com

 

 

 

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/wsbarp/attachments/20171120/6e3d46da/attachment.html>