12.13.07
Disregarded Entities Must Start Paying Taxes in Their Own Names
Recently amended final regulations mandate that disregarded entities (typically a single member limited liability company or Qualified Subchapter S corporation Subsidiary) must soon start paying certain federal excise taxes and federal employment taxes in their own names. The new excise tax rules will take effect on 1/1/2008. The federal employment tax rules, which will impact many more taxpayers, won't take effect until 1/1/2009.
As of 1/1/2008, disregarded entities must start paying certain federal excise taxes in their own names. The new rules affect liabilities imposed for certain excise taxes and actions required or permitted with respect to those excise taxes in periods beginning on or after 1/1/2008. This will affect the following forms:
Form 720 (Quarterly Federal Excise Tax Return)
Form 730 (Monthly Tax Return for Wages)
Form 2290 (Heavy Highway Vehicle Use Tax Return)
11-C (Occupation Tax and Registration Return for Wagering)
Form 8849 (Claim for Refund of Excise Taxes)
Form 637 (Application for Registration (For Certain Excise Tax Activities)
If you have disregarded entities that will be affected by the new federal excise tax rules, now is the time to get a federal tax ID number. Ask your SS&G representative about setting you up to handle the new excise tax payment and reporting obligations.