1) If I report my business income (less than $200 gross), as a hobby, will I be required to pay back the past deductions as a business? No
2) Before I report as a hobby, do I need to close out my LLC? Or is it okay to report the LLC income as a hobby for this year since it is under $200 anyway? Since a single member LLC is a disregarded entity you will simply stop filing the Sch C. If you have any assets still being depreciated then you will "sell" them by converting them to personal use. For the federal return that is all you need to do.
If your state requires it (since an LLC designation is a state issue) you may need to "close" the business with them in the manner they dictate ... check local laws for the rules.
