My sister and I stared a business together last year can we both file our taxes as self-employed for that business? Or do we need to do a 1065 form?

[MinhT1]

In fact, by starting the business together, you and your sister have formed an informal partnership.

It would be much easier for the partnership to report its income and expenses as a partnership on form 1065 then allocate to each of you your share of the profit/loss through the Schedules K-1, rather than each of you reporting half of income and of every expense on a Schedule C.

[Opus 17]

If fact, you MUST file as a 1065 partnership, because the only time you can file a partnership as 2-schedule C businesses is if the only two partners are spouses, in that case it is a "qualified joint venture".  You can't have a qualified joint venture with your sibling.