@calm technician
You either have a separate entity (such as a partnership which files a Form 1065 and issues K-1s to its partners) or you don't. The choice is generally up to the co-owners.
Regarding Schedule E, if you are filing a Form 1065, rental income and expenses are reported on Form 8825 and filed as an attachment to Form 1065 when the partnership files its return. Information from the K-1 will appear, among other places, on Part II of Schedule E.
