Move from sole-proprietor to qualified joint venture

[Pitch-Black-Forest]

Me and my spouse meet the requirements for a qualified joint venture. I have been filing as a sole proprietor for several years and I've very comfortable and familiar with how to enter all tax info. I found some info about entering "form mode" and changing the schedule C to a joint venture. When I go back to step-by-step mode, it tells me I should be filing as a partnership. Do I just ignore that and continue like normal? Are there additional things I must do to make this legit for the IRS. I'm very cautious and really don't want any tax head aches. Bottom line question, Do i click the joint venture box and that's it? Continue through Turbo tax like normal?

[DavidD66]

The only thing you have to do to make the Qualified Joint Venture election is to divide up all items of income, gain, loss, deduction, and credit between you and your wife (in accordance with each of your respective interest in the joint venture (doesn't have to be 50 - 50).  Then each of your file a separage Schedule C and SE.  If you are using TurboTax Desktop you can click on the Joint Venture box, and the program will split all of your income, expenses, etc. 50 -50.  

Is your business operating under an LLC?  If so, you cannot be Qualified Joint Venture.  Only businesses that are owned and operated by spouses as co-owners (and not in the name of a state law entity) qualify for the election.  You cannot be an LLC or LLP, or LP. 

[Pitch-Black-Forest]

I am using desktop. I see when i select "operated jointly" box, a second Schedule SE (SE-T and SE-S) is made with everything halved. I still only see 1 Schedule C however.  Also, All income is reported by 1099's is under my name only. No issues there?

[CatinaT1]

Each spouse must include a separate Schedule C reflecting his/her share of the income and deductions on their joint tax return.

Here is a couple FAQs:

What is a Qualified Joint Venture? - The TurboTax Blog - Intuit

Election for married couples unincorporated businesses

[Pitch-Black-Forest]

Thank you for clarifying. Its a real shame that TurboTax doesn't have an automated way to do this. With all 1099-NEC and 1099-k under my name, it makes things a lot more complicated to split everything even. Should I report all those income amounts on my schedule C and add an expense for half that amount as "QJV spouse expense"? Then have spouse in separate Schedule C report that amount under "other self-employment income" as "QJV income"?

[DavidD66]

No, that is not the way to file a joint venture.  What you are describing would be more like treating your wife as an independent contractor, which would require you to pay her and issue her a Form 1099-NEC.  

Is the Joint Venture election not working in TurboTax Desktop?  

[Pitch-Black-Forest]

It could be user error but no. It seems that there isn't support for a joint venture election. It just prompts me to file as a partnership. I could just split everything but the income from the 1099-k's and 1099-NEC's are in my name only. I saw the above work around in a different forum post but I've been seeing contradicting "solutions" so its hard to tell what is proper.

[AmyC]

There are only a few community property states so there aren't many qualified joint ventures. You file a married filing joint return with two sch C. The IRS can figure out the income is under your name and showing on both returns. That isn't a problem. 

The program should split everything for you. If it refuses, you can make the 2 sch C forms and split everything. All the ones I handle, the income is always in one name -never had a problem.

Reference:

Election for married couples unincorporated businesses

[Loanranger]

I'm guessing these options are only available on the desktop version? I have been trying to do this on the online version and totally cannot figure it out. My wife and I definitely qualify for QJV but I'm running out of time here.

[RobertB4444]

Then you can switch to the desktop version.  Here is how to switch.

@Loanranger