Sch C on my return for investor

[stech]

My brother registered the LLC. We agreed that I would put all revenue & expenses on my returns. All banks accounts are on my name. Can I put that business on my Sch C?

[Mike9241]

we don't know what the business arrangement is between you and your brother but if it's supposed to be 50/50 and you are reporting it all, that might rise to the level of tax evasion. also,  if your bro is to share in the business activities there's a need to file a partnership tax return if no entity election was made. failure to file can result in a penalty of about $5,000 if the 1065 is filed a year late. it was due 3/15/2024 for 2023. if on the other hand, the business is entirely yours, and it's not rental real estate, royalties, farming,  or investment activities such buying/selling securities. Schedule C would probably be the proper form. if investing closed rades go on schedule D/8949, interest on 1099-int, dividend on 1099-DIV. most investment expenses except investment interest expense (schedule A) are no longer deductible for Federal purposes. 

[stech]

I provided all the investment such as capital to run the business. It’s not a partnership so I can’t file 1065. Even if I do file 1065, I would be 98% owner. Hence take 98% activities to my K-1

it was an LLC. So not sure why 1065 is needed. First year my brother took all revenue/expenses and this is 2nd year we are doing taxes. We agreed we will take turns on who to report to their return 

[PatriciaV]

Who is included on the LLC registration? Are you both on the Operating Agreement? Did you use a lawyer to incorporate? 

A multi-member LLC is required by the IRS to file a tax return every year until it dissolves. Per the IRS, "A domestic LLC with at least two members is classified as a partnership for federal income tax purposes unless it files Form 8832 and elects to be treated as a corporation."

The LLC operating agreement may state that you receive 100% of the profit and loss. But other aspects of a partnership are set by the IRS.

The only way to prepare Schedule K-1 is from Form 1065, the partnership tax return.

You may wish to consult with a local tax expert on these questions, to be sure you are in compliance with all laws and regulations.

[stech]

How is it a partnership? He has been filing Sch C on 1040 for past 2 yrs. It is Member or Manager of the Limited Liability Company.

my brother is registered as registered agent 

Now I want to add all revenue & expense to my return. Since I paid all expenses, took care of business and it was an agreement between us. Plus my brother is fine with me taking this business on my Sch C. 

[KrisD15]

LLC is a Limited Liability Company.

It is recognized by the state, but it is not a filing entity recognized by the IRS.

For filing purposes, an LLC needs to be something else in addition to an LLC, such as a 

Disregarded Entity (Sole-Proprietorship) LLC is treated as the same as the ONE owner

Partnership 

Corporation 

You can't have an LLC treated as a "Disregarded Entity" and change the person that files for that entity year after year.

Here is a link about making a tax classification for an LLC.

Changes can be made, but there are limits time frames and ramifications 

[stech]

Even if we have an agreement that I would take up all trans to my Sch C & other person wouldn’t?

My concern is what determines who owns the business? 

I also have another LLC registered under myself. What if, my brother claim his business on Sch C. Write me 1099, then I take that 1099 on my Sch C?

assuming my brother business generated $10k revenue - $10k expense 1099, he would own no tax. Then I would pay taxes on my return 

[RobertB4444]

Since the business is an LLC then having it on schedule C is just fine.  But @KrisD15 is absolutely right - you can't keep switching who files each year.  So your idea with the 1099 is fine.  Have your brother issue you a 1099 from the company and then put it on your return and go from there.  Or you can draw up papers and have your brother sell you the company and then you can put it on your tax return going forward.  All of these are things that you should be discussing with a legal professional who can get your company set up right and help keep you out of trouble.

@stech