topic I am adding my daughter as a partner to my business. Since we both will be part of the business, do we have to file a separate return? in Business & farm

I am adding my daughter as a partner to my business. Since we both will be part of the business, do we have to file a separate return?

krasnopolsky2022 — Tue, 10 Mar 2026 07:25:48 GMT

Last year I just filed a joint return with my husband and it was included in that. How is it handled when there are now two people as part of a business?

Re: I am adding my daughter as a partner to my business. Since we both will be part of the business, do we have to file a separate return?

xmasbaby0 — Thu, 08 Dec 2022 21:13:31 GMT

You have not provided any information about your daughter. However, your daughter's income does not go on your tax return. If your daughter needs to file a return, she has to file her own tax return. You have not mentioned her age, etc. so we do not know if she is a dependent on your tax return. If she is a dependent then she has to say in My Info that she can be claimed as a dependent on someone else's tax return.

You may need further advice regarding the business partnership, however, and may need to seek local paid tax help. If you have a multi-member LLC, for instance, you have to file a return for that partnership using TurboTax Business, which can only be used on a Windows computer.

Provide more details so someone here can share their thoughts.

@Critter-3 @VolvoGirl

Re: I am adding my daughter as a partner to my business. Since we both will be part of the business, do we have to file a separate return?

krasnopolsky2022 — Thu, 08 Dec 2022 21:23:11 GMT

Never mind. I found my answer on the IRS website.

Re: I am adding my daughter as a partner to my business. Since we both will be part of the business, do we have to file a separate return?

Opus 17 — Thu, 08 Dec 2022 21:57:54 GMT

If two or more people operate a business together, they are a partnership, whether or not they form an LLC. The partnership must file a form 1065 partnership tax return. This is due March 15 (not April 15) and the late penalty is $200 per month per partner. The partnership return will issue a K-1 statement to each partner, that is included on the partner's tax return along with any other income, deductions, credits and dependents. The K-1 passes through the partner's share of income and expenses to their personal tax return. To prepare a 1065 with turbotax, you need Turbotax Business, which is a separate program only available as a CD or download to install on your own PC. There is no Mac or online version.

(Alternatively, your daughter could be a W-2 employee of your business, or she could be a 1099-NEC subcontractor. That would be two other ways of recognizing her participation without making her an equity partner. If she is a partner, you have to go the route of the 1065.)

Re: I am adding my daughter as a partner to my business. Since we both will be part of the business, do we have to file a separate return?

krasnopolsky2022 — Thu, 08 Dec 2022 22:07:22 GMT

Very helpful. Thank you.