kevorcam
New Member

I operated as a sole-proprietor for 9 months of the year, then as an LLC partnership for the last 3 months. How do I file? And which Turbo Tax version is best for me?

 

Business & farm

A few more facts would be good to provide a concise response:

  • You indicate "then as an LLC partnership".  Are you saying that this is a multi-member LLC or are you the only owner?
  • If you are the only owner of the LLC, do you have employees?
  • If this was converted to a multi-member LLC, what property was contributed; cash, personal property, real estate, inventory, etc.
  • If a multi-member LLC, what did the other member contribute?
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
kevorcam
New Member

Business & farm

Rick19744, thanks for responding. My wife and I formed a multi-member LLC, so we're 50/50 partners. We didn't have any employees in 2019. When we formed the LLC, we contributed tools and materials, but not cash. Does this help? 

ThomasM125
Expert Alumni

Business & farm

You may be able to file everything on your personal tax return with a schedule C like you have been doing. This would be so if you can be considered a  "qualified joint venture".

 

The qualified joint venture is basically an LLC that is operated by a husband and wife. You would both have to materially participate in the business and be willing to report your share of income and expenses separately on your personal tax return, schedule C. You would also have to be the sole owners of the business.

 

You can find out more about this by using this link:

 

https://www.irs.gov/businesses/small-businesses-self-employed/election-for-married-couples-unincorpo...

 

If you choose to file as a qualified joint venture, you would use the TurboTax Sefl-Employed product. If you choose to file as a partnership, you will need the TurboTax Business product as well a personal tax return product, such as TurboTax Premier or Deluxe.

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Business & farm


@kevorcam wrote:

My wife and I formed a multi-member LLC, so we're 50/50 partners.


If you and your wife are in a community property state (Louisiana, Arizona, California, Texas, Washington, Idaho, Nevada, New Mexico, and Wisconsin), you can elect to treat the LLC as a disregarded entity and each of you can file a Schedule C.

 

See https://www.irs.gov/pub/irs-drop/rp-02-69.pdf

 

Otherwise, you need to file a Form 1065 (partnership return); you cannot elect QJV (qualified joint venture) status if the business is in the name of a state law entity (e.g., an LLC).