Amending a return to go from reporting Partnership and K-1 income to using Schedule C

[strobelkevin]

My wife and I jointly own a LLC. I filed a Partnership return 1065 and generated K-1s for my wife and I. When I filed our 1040 I reported the K-1 incomes which was 50/50 with my wife and I. As I was preparing the 1040 on Turbotax, I saw the suggestion that when a LLC is jointly owned by a married couple filing jointly, it can be advantageous to use Schedule Cs for each of us splitting income and business expenses equally. I did not do that due to time pressures. I have now gone back to see what difference it would make and I would owe almost $600 less to the IRS using the Schedule C method. Having already filed the 1065, can I still amend the 1040 return and use a Schedule C for my wife and I instead of reporting the income from the Schedule K-1s?

[ThomasM125]

That is theoretically possible, but you would have to amend the form 1065 for the partnership to reflect no income and an explanation as to what you are doing. 

You need to be sure that you are including all items of income and expense on the schedule C's however, as often there wouldn't be any difference in tax in filing it that way versus as a partnership.

Also, you need to make sure you are eligible to file as a schedule C, as there are requirements that you have to follows. You can read more about that here:

https://www.irs.gov/businesses/small-businesses-self-employed/election-for-married-couples-unincorpo...