Posted by JHyre in Ohio on May 06, 1999 at 06:52:59:
Another messy question of fact, depending on all the details. If I spend less than 500 hours per year managing my own property, usually no active business and hence no problem. If more than 500 hours, IRS has a decent argument that an active business exists- I’d think of using an S-corp to avoid payroll taxes at this point…once search engine is working, search for conversion I had with Jamie R (Polish/East European last name- I’ll be darned if I can spell it) on this exact topic. If you manage someone else’s property, you very likely have an active business that produces wage income if you are in LLC form- again, look at using an S-corp if your emphasis is on avoiding payroll taxes and you don’t need the LLC’s flexibility with partners.