Not sure what is known here. So I'll try my best to clarify. I assume the business is a single member LLC that has not elected S-Corp or C-Corp status with the IRS by filing the appropriate form.
A single member LLC is considered a disregarded entity by the IRS. The owner of a single member reports all income/expenses on SCH C as a part of their personal 1040 tax return. The owner's profit or loss from the business is shown on line 31 of the SCH C. While the LLC may have employees, owner's draws from the business have no impact on the figure shown on line 31, as the owner does not "pay themself" a wage, and does not issue themself a W-2 or any other type of tax reporting document.
I'm curious if there are any negative repercussions to her paying me the equivalent of what both of us make - allowing me to be the sole purchaser of a home?
After 3 to 5 consecutive years of not showing a profit, it has the potential to "raise eyebrows" with the IRS, as it makes one question how they can stay in business so long, without ever making a profit. I myself have not actually heard of this ever actually happening, but I think it's worth mentioning since you are not married to the business owner and therefor no joint tax return is filed.
You might want to consult with a tax professional (especially if your state taxes personal income) to see if closing the current single member LLC and opening the business as an S-Corp might help in time. The owner of an S-Corp "can" be a W-2 employee of that type of business. But there's a lot more rules to be followed on the tax front with an S-Corp, and that's why a consultation with a tax professional is highly recommended.
