You Started an LLC. Did You Tell Your CPA? What Your Accountant Needs to Know (and Why It Matters)

You Started a New LLC. Did You Tell Your CPA?

Quick answer: When you form a new LLC, your CPA needs nine things: the formation date and state, the number of owners and their percentages, your EIN confirmation letter, how you want the LLC taxed (and whether to elect S corporation status), the business bank account, startup costs you have already paid, whether you will hire employees or pay contractors, which states you will operate or sell in, and a realistic first-year profit estimate. Tell your CPA within the first 60 days. Several of the most valuable tax decisions, including the S corporation election, run on a clock that starts the day the state approves your LLC.

Key takeaways

• An LLC is a legal entity, not a tax category. The IRS taxes it as a sole proprietorship, a partnership, or a corporation depending on owner count and elections.
• The S corporation election (Form 2553) is due 2 months and 15 days after the start of the tax year you want it to apply to.
• A single-member LLC owner pays 15.3% self-employment tax on most net profit, on top of income tax. That number drives most entity decisions.
• Georgia charges $110 to form an LLC and $60 each year for the annual registration, due by April 1.
• Domestic U.S. LLCs no longer file beneficial ownership (BOI) reports with FinCEN after the agency’s August 2026 final rule.

Why does this keep happening?

It is one of the most common conversations in a tax office, and it usually happens in February. A client sits down with a stack of 1099s, a shoebox of receipts, and an offhand comment: “Oh, I also started an LLC last spring.”

The paperwork took 15 minutes online. The state approved it in a few days. An online filing service sent a congratulatory email and an upsell for a logo. Nobody mentioned the accountant.

That gap is understandable. Forming an LLC feels like a legal step, and it is. But the moment the Georgia Secretary of State stamps your Articles of Organization, a series of tax decisions and deadlines begins, and most of them are quiet. There is no reminder letter for an S corporation election. There is no notice warning you that estimated taxes are due. The IRS simply waits until your return arrives to see what you did.

At Pantana CPA, which has served business owners across Georgia and nationwide since 2002, our team sees the fallout every filing season. The good news: almost all of it is preventable with one phone call. Here is what that call should cover.

Is an LLC taxed differently than a sole proprietorship?

Not automatically. An LLC is created under state law. The IRS does not have a separate “LLC” tax return. Instead, according to the IRS guidance on limited liability companies, an LLC is taxed by default based on how many owners (members) it has:

LLC type	Default federal tax treatment	Return filed	Due date (calendar year)
Single-member LLC	Disregarded entity (taxed like a sole proprietor)	Schedule C on your Form 1040	April 15
Multi-member LLC	Partnership	Form 1065 plus a Schedule K-1 for each member	March 15
LLC electing S corporation status	S corporation	Form 1120-S plus K-1s	March 15
LLC electing C corporation status	C corporation	Form 1120	April 15

An LLC can change its default classification with Form 8832, Entity Classification Election, or elect S corporation treatment directly with Form 2553. Which one makes sense depends on numbers your CPA can only run if they know the LLC exists.

One detail catches many new owners: a two-member LLC owned by spouses is generally a partnership by default and must file Form 1065, a separate return with its own March 15 deadline. Spouses in community property states have an exception. Georgia is not one of those states. (The separate “qualified joint venture” election only applies to unincorporated spouse-owned businesses, not to an LLC, so Georgia spouses who form an LLC together should plan on a partnership return.)

What exactly does my CPA need to know about my new LLC?

This is the checklist our team works through with every new business client. Bring as much of it as you can to your first meeting.

1. The formation date and state

Your Articles of Organization show the effective date. That date starts the clock on the S corporation election and determines whether you have a short first tax year. If you formed in another state (Delaware and Wyoming are popular) but operate in Georgia, you likely also need to register as a foreign LLC in Georgia.

2. The owners and their percentages

Owner count decides the default tax treatment. Ownership percentages, capital contributions, and any special profit splits in your operating agreement decide how income is allocated on K-1s. Bring a copy of the operating agreement if you have one.

3. Your EIN confirmation letter (CP 575)

Most LLCs need an Employer Identification Number. The IRS issues one free through its online EIN application. Be cautious of websites that charge for this. Your CPA needs the confirmation letter because it shows how the IRS has your entity classified and who is listed as the responsible party. If the responsible party changes later, the IRS requires Form 8822-B within 60 days.

4. How you want the LLC taxed

This is the big one. More on the S corporation question below.

5. Your business bank account

Mixing personal and business money is the single most expensive habit we clean up. It weakens the liability protection that was the reason you formed the LLC, and it turns tax preparation into forensic accounting. Your CPA should know which account is the business account from day one. If keeping up with the books feels overwhelming, our 15-minute weekly bookkeeping habit is a good place to start, or let our accounting and bookkeeping team handle it.

6. Startup costs you have already paid

Under the federal rules for startup and organizational costs explained in IRS Publication 583, Starting a Business and Keeping Records, you can generally deduct up to $5,000 of startup costs in your first year, with the rest amortized over 15 years. The $5,000 shrinks dollar for dollar once total startup costs pass $50,000. Formation fees, legal fees, market research, and pre-opening advertising all count. Keep the receipts. For a broader look at what qualifies, see our guide to deductible business expenses and our printable guide to launching a new business.

7. Whether you will have employees or contractors

Employees mean payroll, federal and Georgia withholding accounts, and state unemployment registration. Contractors mean collecting a Form W-9 before the first payment. (Thinking about your first hire? Read the real cost of hiring your first W-2 worker and how our payroll services work.) Starting with payments made in 2026, the One Big Beautiful Bill Act raised the Form 1099-NEC and 1099-MISC reporting threshold from $600 to $2,000, as summarized in the IRS overview of the law’s business provisions. Payments made in 2025 still used the $600 threshold. We break down the change in New 1099 Rules Could Save or Cost You Thousands.

8. Where you will operate and sell

Selling taxable goods in Georgia requires a sales and use tax account through the Georgia Department of Revenue’s new business registration. Selling or working in other states can create filing obligations there too. Your city or county may also require a business license (occupation tax certificate).

9. A realistic first-year profit estimate

Your CPA uses this to set up quarterly estimated tax payments and to decide whether an S corporation election pays for itself. A rough number is far better than no number.

Should my new LLC elect S corporation status?

Sometimes, and the deadline is tight. For a single-member LLC, every dollar of net profit is generally subject to self-employment tax at 15.3% (12.4% for Social Security up to the 2026 wage base of $184,500, plus 2.9% for Medicare with no cap). The tax applies to 92.35% of net earnings. That 7.65% reduction mirrors the employer half of payroll taxes, which an employee never sees on a paycheck.

An LLC taxed as an S corporation works differently. The owner who works in the business must take a reasonable salary through payroll, and payroll taxes apply to that salary. Remaining profit can be distributed without self-employment tax. Those distributions are not tax-free: all of the S corporation’s profit, salary and distributions alike, still flows through to the owner’s personal return and is subject to federal and Georgia income tax.

Here is the payroll and self-employment tax math on a business netting $100,000. Both scenarios pay roughly the same income tax; only the payroll or self-employment tax differs.

Scenario	Amount subject to Social Security and Medicare tax	Approximate tax
Single-member LLC (default)	$92,350 (92.35% of $100,000)	$14,130
LLC taxed as S corp, $55,000 reasonable salary	$55,000 in wages (the remaining $45,000 is distributed: no payroll tax, but still subject to income tax)	$8,415
Payroll and self-employment tax difference, before added costs		about $5,700

That savings is not pure profit. An S corporation adds payroll processing, quarterly payroll filings, a separate Form 1120-S, and stricter bookkeeping. The salary must hold up to IRS scrutiny as reasonable for the work performed. Unreasonably low salaries are the IRS’s main line of attack on S corporations: if an owner pays themselves too little, the IRS can recharacterize distributions as wages and assess back payroll taxes, penalties, and interest. As a general pattern, the election starts to make sense once net profit is consistently well above what a reasonable salary for your role would be. Below that, the added costs can erase the benefit. Our article on choosing the right business structure compares the options side by side.

The timing rule: Form 2553 must be filed no later than 2 months and 15 days after the beginning of the tax year the election is to take effect. For a new entity, the first tax year begins on the earliest of the date it has owners, acquires assets, or begins doing business, which can be earlier than you think. For a new LLC formed on May 1 that starts operating the same day, the election is due by mid-July to apply from day one. For an existing calendar-year LLC, the deadline is March 15. The IRS does offer relief for late elections under Revenue Procedure 2013-30, generally within 3 years and 75 days of the intended effective date, but it requires showing reasonable cause, filing everything correctly, and meeting every S corporation eligibility requirement for the entire period. It is a repair, not a plan.

Georgia owners of LLCs taxed as partnerships or S corporations should also ask about the state’s elective pass-through entity tax, which can help work around the federal SALT deduction cap for higher earners. Under the One Big Beautiful Bill Act, that cap is $40,400 for 2026 (up from $40,000 in 2025), but it phases down for modified adjusted gross income above roughly $505,000, never below $10,000, and is scheduled to revert to $10,000 after 2029. High earners in the phase-down range often get the most value from the PTET election. The Georgia Department of Revenue’s PTET FAQ explains the mechanics. Georgia’s flat individual income tax rate dropped to 4.99% on January 1, 2026, under HB 463, according to the Governor’s office.

Do I have to pay estimated taxes on my LLC income?

Almost certainly, yes. No employer is withholding tax from LLC profits. The IRS expects you to pay as you go through quarterly estimated taxes if you expect to owe $1,000 or more. For income earned in 2026, the remaining due dates are January 15, 2027, for the fourth quarter, with the first three quarters already past (April 15, June 15, and September 15, 2026).

You can generally avoid an underpayment penalty by paying in at least 100% of last year’s total tax (110% if your adjusted gross income was above $150,000), or 90% of this year’s. A first-year business owner who was a W-2 employee last year often has the easiest target: last year’s tax bill. Georgia expects estimated payments too. For help with the dollar amount, see how much you should actually be setting aside for taxes and our recap of the September 15 estimated tax deadline.

What does it cost to keep a Georgia LLC in good standing?

According to the Georgia Secretary of State’s fee schedule effective September 6, 2025:

• Articles of Organization: $100 plus a $10 surcharge, $110 total
• Annual registration: $50 plus a $10 surcharge, $60 total, filed between January 1 and April 1 each year
• Late annual registration penalty: $25

The Secretary of State’s annual registration guide walks through filing. Missing it repeatedly can lead to administrative dissolution, which can create real problems with banks, contracts, and liability protection.

Do I still need to file a beneficial ownership (BOI) report?

Not if your LLC was formed in the United States. On August 11, 2026, FinCEN finalized a rule permanently exempting all U.S. domestic companies from beneficial ownership reporting under the Corporate Transparency Act. Only certain foreign entities registered to do business in a U.S. state still report, and only for non-U.S. owners. Check FinCEN’s BOI page for current status. Be wary of letters or emails demanding a BOI filing fee; scams built around this requirement were common.

Case study: The LLC that showed up in February

This is an illustrative composite drawn from situations our team handles every filing season. Names and identifying details are omitted; the numbers reflect realistic, typical figures.

The client was a metro Atlanta landscape designer who had spent eight years as an employee of a larger firm. In March 2025, she went out on her own. She filed Articles of Organization online for $110, got an EIN the same afternoon, and landed her first three residential projects within a month.

She did not call her CPA. She did not open a business bank account until August. Client checks went into her personal checking account for the first five months.

She walked into the office the following February with a W-2 from her old employer covering January through March, a stack of invoices, and one question: “How bad is this?”

What the team found. After reconciling roughly 1,100 transactions across two accounts and two credit cards, the LLC’s net profit for 2025 came to $84,000. She had made no estimated tax payments. She had paid two subcontractors a combined $10,700 without collecting W-9s or issuing 1099s, which were due January 31. She had also spent $4,300 on design software, a professional plotter, and formation and legal fees before landing her first client.

What got fixed.

• The team requested W-9s from both subcontractors and filed the late 1099-NECs within 30 days of the deadline, keeping penalties in the lowest tier.
• The $4,300 in pre-opening costs was sorted into startup costs and equipment, all deductible in the first year.
• Self-employment tax on $84,000 came to about $11,870. Combined with federal and Georgia income tax, she owed a balance she had not set aside. The team calculated the underpayment penalty (and checked for IRS penalty relief options), set up an IRS payment plan for the balance, and built a 2026 estimated tax schedule based on her prior-year safe harbor.
• Books moved to cloud bookkeeping with the business account as the only account for business income.

The forward-looking decision. With 2026 profit projected near $110,000, the team modeled an S corporation election. At a reasonable salary of $60,000, payroll taxes on the salary would run about $9,180, compared with roughly $15,540 in self-employment tax on the full profit. That is a payroll and self-employment tax savings of about $6,360 before payroll and return preparation costs. Her income tax on the $110,000 would be roughly the same either way. Because she called in February, Form 2553 went in before the March 16, 2026, deadline (March 15 fell on a Sunday), and the election took effect January 1, 2026.

The lesson. Nothing she did was unusual, and nothing was unfixable. But a single 30-minute call in March 2025 would have meant a business bank account from day one, quarterly payments instead of a February surprise, W-9s on file before the first subcontractor check, and a planned conversation about the S corporation election a year earlier.

What happens if I already started my LLC and never told my CPA?

Call now, not in March. Most problems get cheaper to fix the earlier they are found. Specifically, as of October 2026:

• The January 15, 2027 estimated payment is still ahead, so you can reduce underpayment penalties for 2026.
• Business equipment acquired after January 19, 2025, and placed in service before December 31 may qualify for full expensing under Section 179 (up to $2.56 million for 2026) or permanent 100% bonus depreciation, both strengthened by the One Big Beautiful Bill Act. Equipment acquired under a binding contract signed before that date does not qualify for the 100% rate. Note that Georgia does not follow federal bonus depreciation and only partially conforms to Section 179, so your Georgia deduction may be smaller and spread over several years. The IRS page on the law’s provisions lists the details, and our article on buying equipment before year-end covers the timing.
• A year-end tax projection shows what you owe before December 31, not after. Year-end is also the right moment to set up W-9 collection so 1099s are ready by the January 31 deadline.
• If you want S corporation treatment starting January 1, 2027, the election will be due March 15, 2027. Planning in the fourth quarter gives you time to set up payroll correctly.

Your new LLC checklist

Task	When	Where
Get a free EIN	Right after formation	IRS.gov
Open a dedicated business bank account	Before the first deposit	Your bank
Send formation documents, EIN letter, and operating agreement to your CPA	Within 60 days	Pantana CPA
Decide on S corporation election	Within 2 months and 15 days of the tax year start	Form 2553
Register for Georgia sales tax or withholding, if needed	Before first taxable sale or first payroll	Georgia DOR
Collect W-9s from contractors	Before the first payment	Form W-9
Pay quarterly estimated taxes	April 15, June 15, Sept. 15, Jan. 15	IRS and Georgia DOR
File Georgia annual registration	January 1 to April 1 each year	Georgia SOS

Frequently asked questions about new LLCs and your CPA

Do I need to tell my CPA when I start an LLC?

Yes. Forming an LLC triggers tax decisions and deadlines, including your federal tax classification, the S corporation election window, estimated tax payments, and state registrations. Telling your CPA within the first 60 days gives you time to make those choices on purpose instead of by default.

Does a single-member LLC file a separate tax return?

Not by default. The IRS treats a single-member LLC as a disregarded entity, so business income and expenses are reported on Schedule C of the owner’s personal Form 1040. The LLC files its own return only if it elects to be taxed as an S corporation or C corporation.

When is the deadline to elect S corporation status for my LLC?

Form 2553 must be filed no more than 2 months and 15 days after the beginning of the tax year the election should take effect. For an existing calendar-year LLC, that is March 15. For a newly formed LLC, the clock generally starts on the earliest of the date it has owners, acquires assets, or begins doing business. Late election relief may be available under Revenue Procedure 2013-30 if you have reasonable cause and met all S corporation requirements for the period.

Is an S corporation election always better for an LLC?

No. An S corporation can reduce self-employment tax, but it does not reduce income tax: distributions are still taxable income to the owner. It also requires a reasonable salary through payroll, a separate Form 1120-S, and additional bookkeeping and payroll costs. For businesses with modest profit, those costs can outweigh the savings. Your CPA should model both scenarios with your actual numbers.

Do I need a new EIN for my LLC?

A multi-member LLC, an LLC with employees, and an LLC electing corporate or S corporation status need an EIN. A single-member LLC with no employees is not always required to have one, but most banks require an EIN to open a business account. The IRS issues EINs free online.

Does my Georgia LLC still have to file a BOI report with FinCEN?

No. Under FinCEN’s final rule issued August 11, 2026, LLCs formed in the United States are permanently exempt from beneficial ownership information reporting. Only certain foreign companies registered to do business in a U.S. state must still report.

What does it cost to maintain an LLC in Georgia?

Georgia charges $110 to file Articles of Organization and $60 per year for the annual registration, which is due between January 1 and April 1. A late annual registration adds a $25 penalty. Some cities and counties also require a separate business license.

The bottom line

Forming an LLC takes minutes. The tax consequences last for years. The owners who come out ahead are not the ones with the fanciest entity structure. They are the ones who told their CPA early, kept business money in a business account, and made the S corporation decision with real numbers before the deadline passed.

If you have formed an LLC in the past year, or you are about to, the Pantana CPA team in Acworth works with business owners across Georgia and nationwide on entity setup, S corporation elections, bookkeeping, and first-year business tax returns. Explore our full list of services or contact our team to schedule a conversation. One conversation now is almost always less expensive than the cleanup later.

Related reading from Pantana CPA

• How the One Big Beautiful Bill Impacts Small Business Owners
• 10 Common Tax Mistakes Business Owners Make in 2026
• Is Your Business Ready for Professional Accounting and Bookkeeping?
• The 5 Numbers Every Small Business Owner Should Review Every Month

Sources

• IRS: Limited Liability Company (LLC)
• IRS: About Form 8832, Entity Classification Election
• IRS: About Form 2553, Election by a Small Business Corporation
• IRS: Revenue Procedure 2013-30 (late election relief)
• IRS Publication 583: Starting a Business and Keeping Records
• IRS: Self-Employment Tax
• IRS: Estimated Taxes
• IRS: Business Tax Provisions of the One Big Beautiful Bill Act
• Social Security Administration: 2026 COLA Fact Sheet
• FinCEN: Beneficial Ownership Information
• Georgia Secretary of State: Corporations Division Filing Fees
• Georgia Department of Revenue: Register a New Business
• Georgia Department of Revenue: Pass-Through Entity Tax FAQ
• Office of the Governor of Georgia: 2026 Tax Legislation

Published by Pantana CPA, Acworth, Georgia | Accounting Services | Bookkeeping | Tax Compliance | Payroll Last – Updated: October 8, 2026 Learn more about our services →

This article is for general information and is not tax or legal advice for your specific situation. Tax rules change frequently. Contact Pantana CPA before making entity or election decisions.