Can a business owner beside an LLC draft himself and consequently apply for a full doc mortgage?
I own an LLC. I understand that if I employ myself presently, I would have to wait 2 years, but could I afterwards apply for a full-doc mortgage as an employee? Would it be possible to redo my ending two years' taxes, as if I had been my own company's hand, and apply for a full-doc mortgage sooner?
Answers:
you file legal documents establishing the LLC which can be operate as a corporation, partnership or individual
as the employee, you are issued a W-2 at the end of the year as an individual and for this reason have documentation that you would need to apply for a loan to show your income
you cannot amend your returns unless the LLC be a legal entity for the years you want to amend to reset the life of the LLC
to clear yourself as an employee, you would also have to discharge the full 7.65% Employer's FICA, plus state and federal unemployment taxes, and therefore own a lot more business and payroll tax returns that involve filing, and payroll tax deposits - weekly, monthly, quarterly that hold strict deadlines for depositing and financial penalties if you miss those deadline
you can't redo past years as an "employee" - you would be setting your self up for MASSIVE in arrears payment and non-filing penalties (easily 30-40+% by this time - if they even agree to you do that, which I doubt they would) on the payroll taxes, plus having to redo the LLC export tax returns and your personal 1040 for the last 2 yrs - that would costs you tons more in rates prep fees Source(s): Financial Controller - Payroll Manager
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Answers:
you file legal documents establishing the LLC which can be operate as a corporation, partnership or individual
as the employee, you are issued a W-2 at the end of the year as an individual and for this reason have documentation that you would need to apply for a loan to show your income
you cannot amend your returns unless the LLC be a legal entity for the years you want to amend to reset the life of the LLC
to clear yourself as an employee, you would also have to discharge the full 7.65% Employer's FICA, plus state and federal unemployment taxes, and therefore own a lot more business and payroll tax returns that involve filing, and payroll tax deposits - weekly, monthly, quarterly that hold strict deadlines for depositing and financial penalties if you miss those deadline
you can't redo past years as an "employee" - you would be setting your self up for MASSIVE in arrears payment and non-filing penalties (easily 30-40+% by this time - if they even agree to you do that, which I doubt they would) on the payroll taxes, plus having to redo the LLC export tax returns and your personal 1040 for the last 2 yrs - that would costs you tons more in rates prep fees Source(s): Financial Controller - Payroll Manager
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