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Small Business

can the owner of llc hire himself as freelancer ?

llc created in the US , owner is not resident in the us , not having citizenship of US he dont have work permit , no visa to travel to US can he hire himself as freelancer to work for his llc remotely ?

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David Aning

I am an Enrolled Agent (IRS) and a tax expert

Hi! Generally speaking, your situation depends on if you are the only member of the LLC. If yes, then you are in business for yourself and therefore, no, you do not pay yourself wages as an "employee". You report income as a self employed person or as an independent contractor for federal and self-employment tax purposes. Let me know if this helps! If, however, two or more people are in business with you, then you are in a partnership. At that case, yes, you can hire employees, but you yourself won't be an employee still. I hope this makes sense. Reach out to me if you need additional help with this.

Answered almost 3 years ago

burak aksu

istediğiniz her türlü soruyu cevaplayabilirim

Yes, the owner of an LLC can hire himself as a freelancer, assuming that the LLC is a single-member LLC. In this case, the owner is considered a "disregarded entity" for tax purposes, which means that the LLC is not considered a separate entity from the owner. Therefore, the owner can hire himself as an independent contractor or freelancer to perform services for the LLC, and the income he earns will be reported on his personal tax return.

However, if the LLC has multiple members, the owner would not be considered a freelancer or independent contractor, and his compensation would need to be treated as a distribution of profits, rather than as a payment for services. In this case, the owner would need to be compensated based on his ownership interest in the LLC.

It's important to note that hiring oneself as a freelancer can create some complications and potential risks, especially when it comes to separating personal and business finances and ensuring that all transactions are properly documented. It's always a good idea to consult with a tax professional or attorney to ensure that you are following all applicable laws and regulations.

Answered almost 2 years ago