My wife and I started an llc in 2019 and we are the only members. We have business expenses with no profit so far, what version of turbo tax do we need to use?

[Carl]

My wife and I started an llc in 2019 and we are the only members.

What state are you in? How you file matters, if you are in a community property state. I ask, because my screen shows you're using TurboTax Self-Employed which includes the SCH C. A SCH C is filed with your personal 1040 tax return *ONLY* for a single member LLC with one owner. Since a multi-member LLC must have at least two owners, that would mean you would need to file a 1065 partnership return for the business, and that form is not included in any "PERSONAL" version of TurboTax. You'd need the business version.

But there's an exception if you do "in fact" live in a community property state. IN that case you and your wife can split all the business income and expenses 50/50 and each of you file a SCH C with your joint tax return, with each SCH C showing each owner's half of the profit/loss. Now to your question.

Was your business officially "open for business" in 2019? This matters, because if it was not, then depending on a few other factors you may not need to report your business income/expenses at all on your 2019 return. Those expenses incurred before a business is officially "open for business" are called start-up expenses. You don't claim start-up expenses until the first year the business is actually "open for business". It doesn't matter either, if those start-up expenses were paid in a prior tax year either.

We have business expenses with no profit so far, what version of turbo tax do we need to use?

[Kanabar]

I please have a side question on this reply, regarding: You don't claim start-up expenses until the first year the business is actually "open for business"

Let say the business is officially opened in February 2020, does it mean that you claim the start-up expenses on the taxes you are preparing this year, or you need to wait until 2021 to claim them? 

Thank you

[ColeenD3]

You can't claim start up expenses. You are confusing an LLC set up for the protection of the property owners with having a business. Your rental property is not a business unless you provide services, much like a motel or a bed and breakfast. It is a passive activity, reported on Schedule E, not Schedule C.

You will buy your property and the cost is it's basis. Any major improvements are added to the basis. You will claim income and expenses as of the day you have the property available for rent. This doesn't mean that it has to be rented. From that point on, your expenses are deductible. It is a good idea to have proof, such as newspaper ads or flyers or some sort or advertisement for a tenant.