Business entity

[Jacqulyn Deniston EA]

I have a client that runs his gymnastics and water safety courses through an LLC. He has just started another water workout class that is licensed through a third party he has been reporting it under his LLC, but the company that he gets his license from advertises it under their license name with the area included .. kind of like a franchise. His insurance and everything is paid through the LLC, but we are trying to determine how we can utilize the website the Franchise covers and not have to create a new dba or LLC .. he wants to avoid a second LLC
Does anyone know if we can run this like a sister company and report it all under the LLC .. the entity name is regulated by the company he gets his annual certification from .. but it’s not like the Red Cross where you get certified … you don’t use their name… its kind of like a fitness center (a small independent one) that gets a franchise from 24 hr fitness that specializes in an additional
Type of training that you can’t offer because only they can “certify” you for a huge annual fee .. and then they advertise for you because they only allow one in your area or county..

Not sure this makes sense..
It’s still the same type of training they offer under their LLC.. it’s just more advanced and specialized class

Anyone have any suggestions?
I hope this makes sense.

Thanks!
Jackie Deniston

Sent from my iPhone

[Alma]

If the check is written to his LLC, then it is income to the LLC.

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[professional...@verizon.net]

Everything is currently paid thru Zelle. But the company that holds the Franchise has a website where (if used) can book clients' appointments and take their payment... then they in turn will pay my client... No checks are currently ever received... but if they were, it would be payable to the name the Franchise uses... not the LLC name. 

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[Alma]

If he gets paid by the Franchise, I assume it is to the LLC. So, that would be income to the LLC.

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[PHILIP P STORRER]

Jackie et al,

Lots of facts.. Lots of rules & principles apply…. The character of the payments as to income depends on for whose BENEFIT these payments have been made…and for what were/are they made? ie Why were they made…

Charting the flow of payments may help!!!  Give a description for each leg… 

The answer to “why” is the most important question to ask & answer….

The answer to “WHAT” is also important to help characterize the value of the payment..

You say “No checks are ever received “ you also say payments were/are made thru Zelle.. why wouldn’t  those payments be as good as cash…

  It looks like there is an attempt to call it something it’s not…

Also the substance of any transaction rules over its form… 

Hope this helps…

Phil

Sent from my iPhone

On May 24, 2024, at 1:12 PM, 'professional...@verizon.net' via ClientWhysConnect <clientwh...@googlegroups.com> wrote:



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