Discussion:Accounting Method for an LLC (Partnership) with A C Corp member
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Discussion Forum Index --> Tax Questions --> Accounting Method for an LLC (Partnership) with A C Corp member
| 24 August 2006 | |
| Please help, I'm having a memory lapse...I have an LLC (taxed as a partnership) that is 50.1% owned by a C Corp. The C Corp memeber is required to use accrual basis accounting for its tax purposes. I think §448 requires our partnership to adhere to our C Corp member's accrual method (w/out the C Corp it would be eligible to use the cash basis). Is a higher ownership percentage required (80%) or does the 50.1% trigger it?
Thanks | |
| 24 August 2006 | |
| I'm seeing that §448 (b)(3) may provide our LLC with some temporary relief from using the accrual basis, as long as its 3 year average gross recipts are less than $5M...and this is available despite the fact that it has a C Corp partner and despite that the LLC itself has inventory...am I understanding this correctly? | |
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