Hello- I'm really in need of some help or advice on this unique issue.
I recently sold my business (for a good loss), and I am walking away with no job and a large liability, but less of a liability than if I were to retain the business.
When I bought the business five years ago with my 401K, we set the company up as an LLC (but I am a single member LLC, no partners). To pay back the IRS over the next two years, my accountant set me up as a regular employee on payroll, and called in my salary with the rest of payroll. With that, all regular witholdings were taken out-- taxes, Social Security, unemployment.
I turned the business over on October 6th, then called in for unemployment. Everything went well, until I received a call back from them, saying if the business was anything other than an "incorporation," I would not be entitled to benefits.
I downloaded the 2-page form for corporations to fill out and send back, and replied on that form that yes, my company was an LLC, and I was filing as an "S-Corp" this year.
What should I do? Do I have a leg to stand on if I appeal?
Does anybody have any advice on this issue?
It seems ridiculous to me that I had 42 employees (some of them working only 2 hours/week as a 1099), and every one of these employees CAN collect, and yet, I, who owned the business, put everything on the line, and paid into the unemployment fund for almost 5 years, cannot collect.
Help me please.
Thank you.