Pat and Nicole formed Here & There as a limited liability company. Unless the member owners elect to be treated otherwise, the Internal Revenue Service will tax the LLC as:

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By default, the IRS will tax an LLC as a partnership, which means the income and expenses of the LLC will flow through to the individual members' personal income tax returns. The LLC itself does not pay income taxes. However, LLC members can elect to be taxed as an S corporation or a C corporation if they meet certain requirements.

Pat and Nicole Formed Here & There as a Limited