How are income and expenses for the Aw Company handled for tax purposes?

According to Aw's 2025 Franchise Disclosure Document, the company has elected to be taxed as a limited liability corporation for federal and state income tax purposes. This means that the income and expenses of Aw pass through directly to the members, who then report these on their individual income tax returns.

This is a common tax structure for LLCs, where the business itself does not pay income taxes. Instead, the responsibility for reporting and paying income taxes falls on the individual members or owners of the company. This arrangement is often referred to as "pass-through taxation."

For a prospective Aw franchisee, this implies that any profits or losses from the franchise will be reported on their personal tax returns. It is important for franchisees to consult with a tax professional to understand the implications of this pass-through taxation and how it will affect their individual tax situation. Franchisees should keep accurate records of all income and expenses related to the franchise to ensure proper reporting on their tax returns.