Only freelancers located in the U.S. may apply.U.S. located freelancers only
I will be forming an entity whose sole source of cash inflow will be advance payments for services that will be rendered mostly in future tax years.
My requests include the following:
(1) What criteria must we meet in order to defer revenue recognition to the year(s) when services are rendered, rather than in the year when advance payment is received for such services? The following IRS publications are relevant:
(2) If as per (1), taxes are deferred to a year after 2018, is it possible to set up our organization as an LLC such that 2 members take distributions (that are disproportionate to membership interest) and relatively small salaries, and thereby avoid paying any tax except for tax on the small salaries?
(3) Given our particular compensation plans for two co-founders (which I will describe) and the answer to (2), I require help selecting between a US LLC and a US C-Corporation.
(4) Is there any advantage at all to setting up a Cayman entity if during the period when advance payments were received, but not during the period when services were rendered, the person doing sales were located in the Cayman Islands? It appears that the only reason setting up a Cayman entity would make sense is if it were the only way to avoid paying income taxes on the advance payments.
Less than 30 hrs/week
Less than 1 month< 1 monthProject LengthDuration
I am willing to pay higher rates for the most experienced freelancers