Late 2018 I formed a partnership. Under the name of the partnership I did 2 jobs. Biz partner wants me to report it all personally. Can I legally use a schedule C?

mrrickyg — Tue, 04 Jun 2019 19:44:26 GMT

In November 2018 I formed a partnership and obtained a FEIN. Under the name of the partnership I did two small jobs, one for $500, the second $75. The money was paid out to the partnership but I did all the work, expense and took all income which ultimately resulted in a loss but it helped to get the name of our business out there for the purpose of getting jobs in 2019.

My business partner does not want this to appear on their taxes as they did not actively participate or provide any resources related.

Can I legally report this personally on a schedule C? If the answer is no how can I differentiate the reporting for one partner to have zero and the other to have a loss?

It depends, but you are probably safe to file Schedule C...

DanielV01 — Tue, 04 Jun 2019 19:44:28 GMT

It depends, but you are probably safe to file Schedule C instead of Form 1065, because your entity has not filed a business return before. So if you operated as a sole-proprietorship (as only you generated income and were solely responsible for expenses), then you may have grounds to file as a sole-proprietorship on Schedule C even though the initial intent was to be a partnership, However, another question is if you legally have to dissolve the partnership or not first before you can claim the activities on Schedule C. That could depend on state/local law.

If you were required to register in your state as a partnership, you may have to report as a partnership on Form 1065 anyways. You can have 100% of the activities apportioned to you, and he can select that he did not materially participate in the activity. But if state and local laws require you to dissolve your partnership first, then that's what you'll have to do. If your partner wants to be completely out, you will want to take the formal step to dissolve the partnership and make sure the return is marked Final Return so that the IRS does not ask questions next year when you don't file.

topic Late 2018 I formed a partnership. Under the name of the partnership I did 2 jobs. Biz partner wants me to report it all personally. Can I legally use a schedule C? in Business & farm

Late 2018 I formed a partnership. Under the name of the partnership I did 2 jobs. Biz partner wants me to report it all personally. Can I legally use a schedule C?

It depends, but you are probably safe to file Schedule C...