If I own an LLC, but have not made any money yet, do I need to file taxes?

[sarah-blaine-con]

I created an LLC this year with the hopes of doing some consulting work. If I have not done any consulting work yet, do I need to file anything for the LLC?

[PatriciaV]

No, in most cases you do not need to include any information on your return if you are not yet in business, 

Note that a single-member LLC (you are the only owner) is "disregarded" by the IRS, which considers you and the company to be the same entity. In this case, you will report business activity in the future on Schedule C in your personal tax return.

There are two instances where you would file a tax return with no activity:

1) If this is a multi-member LLC that has been assigned an Employer Identification Number (EIN), you are expected to file a separate business return for this company, even if you had no activity. Most LLC's file Form 1065 Partnership Income.

2) If you have elected to be taxed as a corporation (S-Corp), you will need to file Form 1120-S for this entity, even if you have no activity.

[mikeadfd]

Hello. I recent bought a bar/ Restuarant in a different state then where I live. I have owned it just short of a year. Iam in an LLC with my sister and her husband.  My question is how do I claim income from the bar in the bar did not give me any money. I have put several thousand dollars on credit cards . I have not received any money from the bar.

[HopeS]

If your business generated income and expenses you will need to file a partnership return (Form 1065). Form 1065 is an information return used to report the income, gains, losses, deductions, credits, etc., from the operation of a partnership. A partnership doesn't pay tax on its income but "passes through" any profits or losses to its partners on a Schedule K-1.

If you are a partner in a partnership, the information you need to prepare your individual tax return is on the Schedule K-1 you received from the partnership, not on Form 1065. A K-1 can be a complicated form with lots of lines, but TurboTax asks about the data you need to enter. 

See the below link on how to enter the K-1 received:

How to enter a K-1 in my personal return

Also,  you will need the TurboTax Business version for partnership returns if you are responsible for filing Form 1065. You can find the link below: 

TurboTax Business

If however, your business did not generate any income in the first year but generated only expenses. Turbo Tax will let you enter expenses without having entered any income.  

Since this was your first year in business these costs are entered either under Assets/Depreciation or under Business Expenses. 

Per IRS Pub 535 Business Start-Up and Organizational Costs: "Business start-up and organizational costs are generally capital expenditures. However, you can elect to deduct up to $5,000 of business start-up and $5,000 of organizational costs paid or incurred after October 22, 2004. The $5,000 deduction is reduced by the amount your total start-up or organizational costs exceed $50,000. Any remaining costs must be amortized."

As long as your start-up expenses are less than $5000, you can add them as Business Expenses. Continue past the expense categories (or choose Other Miscellaneous Expenses) to the page titled "Enter Business Expenses Not Yet Reported" and enter the description & amount (see screenshots below - click to enlarge).

If you have more than $5000 in start-up costs, the remainder is entered under Assets/Depreciation as a capital asset for amortization (TurboTax provides this category for you).

Please see the link below for additional information on Business Startup Expenses:

Startup Business Tax Tips

@mikeadfd