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Pass-Through Income Tax Treatment Generally, in an LLC or LLP, the business entity does not pay federal income taxes on its profits. Instead, the company's profit or loss passes through to the owners' tax returns and is subject to tax at the applicable individual income tax rate.
The LLP files a Schedule K-1 (IRS Form 1065) to report its income, gains, losses, and deductions like a general partnership. Partners file Form 1040 and pay self-employment taxes (social security and Medicare).
STEP 1: Access MCA homepage STEP 2: Login to MCA portal with valid credentials1 STEP 3: Select ?MCA services? and further select ?E-Filing? STEP 4: Access ?Form 3 ? Information for LLP Agreement and Changes? STEP 5: Enter LLP Information2 STEP 6: Search LLPIN using the search option (optional)3 STEP 7: Select LLPIN ...
For income tax purpose, LLP is treated on a par with partnership firms. Thus, LLP is liable for payment of income tax and share of its partners in LLP is not liable to tax. Thus no dividend distribution tax is payable.
LLP stands for Limited Liability Partnership. It is an alternative corporate business form that provides the benefits of limited liability of a company along with the flexibility of a partnership.