Q: How do taxes work for a subsidiary LLC?
I have a C corporation. I would like to form a new LLC that the C corporation will wholly own. I want the LLC to be treated as a disregarded entity for tax purposes, which I understand is the default.
Should the LLC file an SS-4 to obtain an EIN? Or does the LLC use the EIN of the parent C corporation? I would like the LLC to have a separate bank account and separate books.
Would I simply add the LLC's income and deductions to the C corporation's income and deductions when filing the parent corporation's 1120?
I've read Publication 3402. I'm guessing that I would use the C corporation's EIN for the LLC. So there's no reason for the LLC to file SS-4. I'm thinking when opening a bank account, I would just bring in a W-9 with the corporation on line 1, the LLC on line 2. Do I understand it correctly?
On the other hand, would it hurt to just file the SS-4 and use a separate EIN for the LLC? Would this EIN be reported anywhere on the C corporation's 1120?
A: The sub would have a separate EIN and books. The net income flows through to the parent corporation.
Bruce Alexander Minnick agrees with this answer
A:
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