Disregarded Entity - Account Registration


B

Bluezfan

Good morning, all. I am a single owner member of an LLC and
use my SSN for reporting. My brokerage firm tells me that
the only way to avoid the "B" Notice/Backup Withholding
issue is to register the account with my individual name on
the first line (i.e., John Doe, Acme LLC). They say that
the first line name must match the reporting TIN with the
IRS records and that the fact that it does not is what
generates the IRS to notify them of the "incorrect" number.

Seems to me I should be able to file something with the IRS
such that the IRS knows that my LLC is a disregarded entity
rather than me having to use my individual name on the
account.

Any insight? Thank you!
 
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H

Harlan Lunsford

Bluezfan said:
Good morning, all. I am a single owner member of an LLC and
use my SSN for reporting. My brokerage firm tells me that
the only way to avoid the "B" Notice/Backup Withholding
issue is to register the account with my individual name on
the first line (i.e., John Doe, Acme LLC). They say that
the first line name must match the reporting TIN with the
IRS records and that the fact that it does not is what
generates the IRS to notify them of the "incorrect" number.

Seems to me I should be able to file something with the IRS
such that the IRS knows that my LLC is a disregarded entity
rather than me having to use my individual name on the
account.

Any insight?
Well yes.

The brokerage firm is quite correct and I can't see where it
matters one bit. And if they list it on 1099 reporting as
"John Doe, Acme LLC" that still won't match. A 1099 form
should thus list John Doe on first line and second line
contain the t/a designation: "Acme LLC" then of course two
lines for the address.

However even putting all on first line might be enough to
match if the big IRS computer in the sky matches on just the
first, say, 12 letters of a name. I dunno.

ChEAr$,
Harlan Lunsford, EA n LA
 
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B

Bill Brown

Bluezfan said:
Any insight? Thank you!
Yes. Get an EIN for the LLC and put that number in the
appropriate space on Schedule C.
 
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J

John H. Fisher

Bluezfan said:
Good morning, all. I am a single owner member of an LLC and
use my SSN for reporting. My brokerage firm tells me that
the only way to avoid the "B" Notice/Backup Withholding
issue is to register the account with my individual name on
the first line (i.e., John Doe, Acme LLC). They say that
the first line name must match the reporting TIN with the
IRS records and that the fact that it does not is what
generates the IRS to notify them of the "incorrect" number.

Seems to me I should be able to file something with the IRS
such that the IRS knows that my LLC is a disregarded entity
rather than me having to use my individual name on the
account.

Any insight? Thank you!
The name and the SS# must match. On Schedule C, the lines
request the name of the sole proprietor and the fictious
name, as does the W-9 which your brokerage firm requests.
You may find this article useful:

http://www.irs.gov/businesses/small/article/0,,id=158625,00.html
 
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