1) When can I apply the start-up expenses in this scenario? 2021, 2022, or both? The LLC was officially formed in 2021, but the rental business (the actual business of the LLC) doesn't start until 2022. If I wait to take start-up expenses until 2022, will it raise any red flags that the return shows a "date business started" in 2021? the business doesn't start until the property is ready for rental which you say will be 2020
2) Will I even need to file a form 1065 (partnership return) for 2021 if there is no income (only expenses)?
except in community property states, an LLC is required to file a return unless it neither receives income nor incurs any expenditures treated as deductions or credits for federal income tax purposes.
don't know what deductible expenses you'll have in 2021 but if you don't file a return those expenses will never be deductible. the maximum penalty for not filing a 2021 return, if required, is over $5,000. $210/month/partner for a maximum of 12 months.
