LLC Conversion- 2 member to one member

[peanut]

I sure do appreciate this forum. I have a client -2 brothers who operated a 2 member construction LLC- No employess- filed a partnership tax return. Now they are splitting up--one brother would like to continue to operated under the LLC trade name.The LLC does have an EI number for purposes of the partnership return. Can this brother continue to operate as a 1 member with the present LLC or does he have to reapply for a new LLC and possibly new EI # although probably doesn't need one since no employess?

Thanks For Replies

[dsi]

Not sure about the FEIN, but once the one brother ceases to be a member, then the "PS" terminates and the continuing brother operates as a disregarded entity.

[ChEAr$]

The procedure

I sure do appreciate this forum. I have a client -2 brothers who operated a 2 member construction LLC- No employess- filed a partnership tax return. Now they are splitting up--one brother would like to continue to operated under the LLC trade name.The LLC does have an EI number for purposes of the partnership return. Can this brother continue to operate as a 1 member with the present LLC or does he have to reapply for a new LLC and possibly new EI # although probably doesn't need one since no employess?

Thanks For Replies

A change in ownership like this requires LLC to file a form with the state with fees of course.
And then, it's a new organization, and therefore new FEI.

Been there; done that.