My husband an I both own a LLC. This is our first year filing taxes with the LLCs. Is it better to file joint or separate?

[xmasbaby0]

Edit added----We need clarity on whether your own the same LLC together or if you each have your own LLC.  Your original question said the you have LLCs, which sounds like you mean you each have your own business.  My reply below is based on that.   If you actually have a multi-member partnership we have other information you will need,

You will need to prepare a Schedule C for each of your businesses---that goes with all the rest of your combined incomes etc.   Filing a joint return is almost always better.

If you were legally married at the end of 2024 your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will get the married filing jointly standard deduction of $29,200 (+ $1550 for each spouse 65 or older)  for 2024. You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return.

 Some of the special rules for filing separately include: you cannot get earned income credit, education credits, adoption credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. In many cases you will not be able to take the child and dependent care credit. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI)

 If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice since with online, you get one return per fee.

https://ttlc.intuit.com/questions/1894449-married-filing-jointly-vs-married-filing-separately

https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states

https://ttlc.intuit.com/questions/1894449-is-it-better-for-a-married-couple-to-file-jointly-or-separ...

If you have self-employment income for which you will pay self-employment tax for Social Security and Medicare,  you will need to use online Premium software or any version of the desktop software download so that you can prepare a Schedule C for your business expenses.

https://ttlc.intuit.com/questions/2926899-how-does-my-side-job-affect-my-taxes

https://ttlc.intuit.com/turbotax-support/en-us/help-article/form-1099-nec/1099-nec/L5qTsBiSe_US_en_U...

https://ttlc.intuit.com/community/self-employed/help/how-do-i-report-income-from-self-employment/00/...

https://ttlc.intuit.com/community/self-employed/help/what-is-the-self-employment-tax/00/25922

https://ttlc.intuit.com/questions/2902389-why-am-i-paying-self-employment-tax

https://ttlc.intuit.com/questions/1901340-where-do-i-enter-schedule-c

https://ttlc.intuit.com/questions/3398950-what-self-employed-expenses-can-i-deduct

https://blog.turbotax.intuit.com/self-employed/self-employed-tax-deductions-

calculator-2021-2022-50907/

https://ttlc.intuit.com/questions/1901110-do-i-need-to-make-estimated-tax-payments-to-the-irs

If you live in a state with a state income tax, you might need to make estimated payments to your state.

https://turbotax.intuit.com/tax-tools/calculators/self-employed/

https://ttlc.intuit.com/community/business-taxes/discussion/self-employed-don-t-miss-these-tax-moves...

[rjs]

Your question is not clear about whether you and your husband each have your own separate LLC, or if you and your husband are both members of the same LLC. But in all cases it will almost certainly be better to file jointly, as xmasbaby0 said.

If you have two separate LLCs, and each LLC has only one member, the LLCs are disregarded for income tax purposes. You file your tax return as if the LLCs did not exist. You have two separate businesses. You report each business on Schedule C in your joint personal tax return.

If you and your husband are both members of the same LLC, then it's a multi-member LLC. If you do not live in a community property state, the multi-member LLC has to be treated as a partnership. The LLC has to file a partnership tax return, Form 1065. The partnership return includes a Schedule K-1 for each member. You each have to enter information from your Schedule K-1 in your joint personal tax return.

If you do live in a community property state, you have a choice as to how you treat the LLC on your tax return. You can choose to treat the LLC as a partnership, as described above. The other choice, if you and your husband are the only members of the LLC, is to treat the LLC as a "disregarded entity." You would file your joint tax return as if the LLC didn't exist. You and your husband would each file a Schedule C for your respective shares of the business income and expenses.

The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin.

Again, in all cases it will almost certainly be better to file jointly.

[Opus 17]

If you are the only two members of an LLC, and you live in a community property state, then you report the business on two schedule Cs, one in each of your names, each reporting half the income and expenses.

However, if you do not live in a community property state, or the LLC has more members than just the two spouses, the LLC MUST file a separate business tax return form 1065.  For this, you need Turbotax Business, which is a separate program from the personal version of Turbotax.  As part of filing the business tax return, you will prepare a K-1 statement for each partner that lists their share of income and expenses.   The K-1 is included on each partner's personal tax return.  The deadline for form 1065 is March 15, not April 15, unless you get an extension, and the penalty for late filing is $195 per month per member.

As to whether it is better to file your personal returns separately or jointly, that can only be known by testing both ways.  But it is almost always better to file jointly. 

[Opus 17]

@xmasbaby0 

Please edit the first part of your answer.