Thank you Eric. No sooner had I hit the “Submit” button than I realized that you had done a podcast (#17) on exactly this topic so I went back and listened to #’s 17 and 37 last night.
Functionally, this guy is an SMLLC. He has a multi-member LLC but the other member is his girlfriend who gets a K-1 for 1%, he’s 99%. I expect the IRS will consider him an SMLLC. I am going to follow all the steps you’ve taught. The first conversation is to determine the viability of the business, make him aware of the severity of the situation including a potential criminal referral, conduct my version of the 4180 interview and then start documenting business and personal living expenses. Thanks again.