Limited liability companies want help on self-employment taxes.

Kiplinger Tax Letter, The, July, 2000

Limited liability companies want help on self-employment taxes. In '97, IRS issued regulations that would have imposed self-employment tax on owners of these firms who weren't very active in running the business. After a firestorm of protest, Congress ordered the Service to hold off.

Current self-employment tax rules are murky for owners of LLCs. Income is exempt from SECA tax if the owners qualify as limited partners for tax purposes. But semi-active LLC owners aren't sure how they fit in.

Congress is being urged to step in by tax lawyers and accountants and provide clear guidelines on when self-employment tax has to be paid.

But odds are against anything passing this year...not enough time.

And IRS isn't in any hurry...got burned the last time it spoke up.