Level 3

CA LLC fee for Texas rental properties

Forum|Forum|2 years ago
October 11, 2023
2 replies
19 views

My clients who are both CA residents have a CA LLC which owns multiple rental properties in Texas. The properties are handled by managers in Texas but my clients make major decisions. The schedule IW for form 568 said that only income from CA source is subject to LLC fee. Since these rental properties are located in Texas, I assume they should be excluded from LLC Fee and I have to manually override on Lacerte. Thank you for your comment.

T

Terry53029

Intuit Community Champion

Every LLC that is doing business or organized in California must pay an annual tax of $800.

L

lilhk3Author

Level 3

I am asking about LLC fee which is based on gross receipts in addition to the LLC tax of $800. I know the LLC has to pay $800LLC tax.

George4Tacks

Level 15

I believe that all rental income is taxable to a CA LLC, regardless of the state it is in. Just like an individual, there can be a tax credit for tax paid to the other state. I also believe that they need to file a Texas Franchise Tax form.

I might be wrong and I don't have specific references for this. Hopefully others will chime in.

Answers are easy. Questions are hard!

BobKamman

Level 15

It's too bad they went to the seminar that told them to put their rental properties in an LLC, but it's a good thing they didn't go to the one that told them to put each one in a separate LLC. Let me guess: They think they have so much liability protection from their California LLC, that they don't have an umbrella insurance policy that protects them from Texas claims.

Sign up

Login with SSO

Let's get you signed in

Login with SSO

Scanning file for viruses.

This file cannot be downloaded