Q: I opened two LLC’s and two bank accounts for the purpose of goods being sold. Partners were not completely honest with
agreements while using the LLC’s. They have disappeared and now I have no P& L statements to file taxes. They left me high and dry.
A:
Facing a situation where partners have left you without the necessary documentation for tax filing can be daunting, especially when it involves LLCs. In Texas, as in most jurisdictions, LLCs are expected to maintain accurate records and file taxes based on their income, deductions, and credits. Without profit and loss statements, fulfilling your tax obligations becomes challenging, but there are steps you can take to address this issue.
Firstly, you should gather all available financial records, such as bank statements, invoices, receipts, and any other documentation related to the LLC's transactions. These documents can help reconstruct the financial activities of your LLCs to some extent. It might also be useful to contact a tax professional who can guide you through the process of organizing your records and determining the best course of action for filing your taxes without complete P&L statements.
Secondly, consider reaching out to the IRS or the Texas Comptroller of Public Accounts to explain your situation and seek guidance on how to proceed. They may offer options or extensions for filing your taxes under these circumstances. Additionally, taking steps to prevent such issues in the future, such as implementing stricter control measures and maintaining regular, independent financial audits, is crucial. While the current predicament is challenging, addressing it proactively can help mitigate potential legal and financial consequences.
A:
In addition to what Mr. Arrasmith suggests, a practical solution would be to get an accounting software program like Quickbooks and download all of your LLC's banking transactions directly from your bank into the software. You can then categorize each banking transaction using the software. The software can then generate a P&L.
You can also download tax preparation software like TurboTax, link your Quickbooks data file to the the tax preparation software, and it will fill in the appropriate boxes for you.
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