Tax help: should I run 1099 income through my search LLC?

March 17, 2021

by a searcher from University of Virginia in Los Angeles, CA, USA

I am currently building out a search effort while doing part-time M&A consulting. The consuling work occupies###-###-#### hours per week and will be a substantial number on my 2021 tax return. My goal is for the consulting work to power a self-funded search.

Currently, I earn 1099 income personally. But I am considering setting up an LLC to capture the consulting income, so that I can deduct the expenses associated with running the self-funded search.

I'm wondering what the tax impact of taking the 1099 income on my personal statement versus running it through an LLC would be. I am also wondering about the implications if I later decided to convert to a traditional (funded) search.

Reply by a professional
from Walsh College of Accountancy and Business Administration in Detroit, MI, USA

Lots to unpack here with this question and may need more facts. I recommend a call to discuss how this should be treated. email me at redacted and we can set up a date and time to discuss.

Reply by a searcher
from University of Virginia in Los Angeles, CA, USA

Thanks, Robert! Emailing you now.

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