@rwom1217 wrote:
If going the separate schedule C's route, when it comes to using a personal vehicle for the business, would I still split the miles in half between us, even though she did not do any business related driving?
I'm concerned about the prior question, "when I decide."
As mentioned by @Anonymous_ , you file Articles with the state to create the LLC but the state doesn't necessarily know your Operating Agreement which lists the members of the LLC and other legal matters. If you don't have an Operating Agreement in writing, you should get a local attorney to help draft one, there are probably some standard things that need to be in there, especially in a community property state.
It's important to understand that LLCs are created by state law and the IRS does not recognize them as separate entities. Under federal tax law, you either have a partnership or a disregarded entity (sole proprietorship). If a partnership, you file a 1065 unless you are in a community property state and the only partners are the spouses. You can't flip-flop between a single member and two-member LLC. Maybe you haven't thought this through thoroughly, but you need to do that soon, and get something in writing in case of audit.
Presuming this is a 2-member LLC with the only members being spouses in a community property state, you divide all your income and expenses exactly in half, even if that is not how the participation is divided.
