How is an LLC classified for Federal tax purposes?
For Federal tax purposes, an LLC business entity must file as either a corporation, partnership or sole proprietorship. Federal tax laws will automatically classify and tax certain LLC business entities as corporations. These entities are: • A business entity formed under a Federal or State statute or under a statute of a federally recognized Indian tribe if the statute describes or refers to the entity as incorporated or as a corporation, body corporate, or body politic. • An Association under Regulations section 301.7701-3. • A business entity formed under a Federal or State statute if the statute describes or refers to the entity as a joint stock association. • A state chartered business entity conducting banking activities if any of its deposits are insured by the FDIC. • A business entity wholly owned by a state of political subdivision thereof, or a business entity wholly owned by a foreign government or other entity described in Regulations section 1.892.2-T. • A business entity
