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Business & farm
Understand that the below is assuming you have ***NOT*** file IRS Form 2553 to have your multi-member LLC "treated like a S-Corp" for tax purposes, nor have your filed IRS Form 8832 to have your multi-member LLC "treated like a C-Corp" for tax purposes. If you have filed either of these forms, then STOP READING NOW.
Our 2 member LLC ......
.....is a disregarded entity as far as the IRS is concerned.
Can we issue ourselves 1099s and pay LLC taxes on what was not distributed?
Re-read my previous comment. Under no circumstances and with no exceptions will you or the partner issue yourselves a 1099-MISC or a W-2. There are no exceptions. Since this disregarded entity is a multi-member LLC, the LLC will issue each partner a K-1 (IRS Form 1065 K-1) which each partner will *require* in order to complete their personal 1040 tax returns.
We aren't salary employees,
The owner's of a multi-member LLC can't be employees, salaried or otherwise, of that same multi-member LLC even if they want to. That doesn't mean you can't have employees. It means that "you personally" can't be an employee of this multi-member LLC.
and we're not administraive executives (like a CFO)
Of course not. A disregarded entity (which in the eyes of the IRS does not exist as a separately taxable entity) can't have an CFO or any other kind of officer. At best, you have a "managing member" and that's it. But even then it does not change the fact that a multi-member LLC is not a separately taxable entity.
We are located in California.
While there are some things that are state specific, this isn't one of those things and it doesn't matter what state you are in.