Nexus of German LLC in CA - Spidell

Nexus of German LLC in CA

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Message Board Nexus of German LLC in CA

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    • #323929
      Jost Rhodius
      Participant

      Our client, a German national. green card holder, owns 50% of an LLC-like business in Germany (his Mom has remaining 50%). The business exclusively operates in Germany. Day to day operations are run by a management company. Client occasionally signs, is involved in strategic decisions and receives updates from management.

      Client is shifting his life gradually from Germany to CA. His wife and child already are in Los Angeles, they bought a house.
      Client intends to spend more and more time in CA, about 6 month in 2022. He will attend US conventions, likes to deduct travel expense on his CA tax return, use a home office or shared office space as needed.

      Does this establish a nexus for the German company? I understand if there is a nexus, he would have to register the firm in CA?
      On the other hand, if he quits business related activities and becomes a “silent” partner, there would be no more Nexus issue, correct?

      Thanks for any feedback.

      Jost Rhodius, EA

    • #324004
      Lynn Freer
      Participant

      I’m not sure how this will work for a company that is “like” an LLC. But having a managing interest or an interest of 50% would require registration and liability for the $800 annual tax.

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