Is this an ASG?

[Jakyasar]

Hi

Joe owns XYZ Real Estate 100% (corporation) and has a DB/DC plan - no employees. He gets a w-2.

Joe forms another entity with Moe (no relationship to Joe) 50/50 ownership, ABC Real Estate. The income is thru commissions. This is an LLC taxed as partnership.

Neither partner gets a k-1 showing any earned income. 

Joe's commissions earnings from ABC RE, LLC are paid to his company XYZ RE and this income is the major source of income XYZ RE.

No CG issues, how about ASG?

Thanks

[Bri]

Is a real estate company a service organization for these purposes?

[Jakyasar]

I do not think so as they get commissions from sales

[Jakyasar]

Update, they did het k-1s for 2024 but a few thousand only.

[Lou S.]

Any time not sure, the best course is to refer to them to legal counsel.

[ESOP Guy]

12 minutes ago, Lou S. said:

Any time not sure, the best course is to refer to them to legal counsel.

This! 

 

You aren't paid enough to make this call in my opinion.  

[Jakyasar]

Totally agree, just wanted to check if there was anyone with a similar situation. I have already advised for counsel.

[SSRRS]

It appears that 50% or more of XYZ 's income is from ABC. This possibly makes this arrangement a MFG (Management Function group)?