Chuck,
Here’s from the latest Gear Up manual on entities. It’s not authority but indicates where the IRS is heading re whether an H/W LLC can file 2 Schedule C’s:
“NEW DEVELOPMENT: While the IRS has yet to issue formal guidance on this change, information on its website reveals that the IRS’ position is that the escape from partnership treatment for spousal business is limited in scope. It does not apply to spouses who operate in the name of a state law entity. The election can be made only for a business operated by spouses as co-owners that is, or should otherwise be, taxed informally (my emphasis) as a partnership. Therefore, a business owned and operated by the spouses through a Limited Liability Company, general partnership, or limited partnership does not qualify for the election.”
Based on that it appears that IRS is taking the position that H/W LLC’s can elect 2 Schedule C’s. Maybe we won’t know for sure until after IRS issues formal guidance and someone challenges it.
John Stevens, EA
Stevens Tax & Accounting, Inc., dba Equi-Tax
651-773-5000
FAX 651-457-4529
equitax@unique-software.com
www.equitax.net
From:
Sent: 10/28/2008 2:28 PM
To:
Subject: RE: [taxchat] Husband-Wife LLC & OIH
I still can’t find where it says that in Sec 761, where qualified joint ventures are defined.
Chuck
From:
Sent: Tuesday, October 28, 2008 2:14 PM
To:
Subject: RE: [taxchat] Husband-Wife LLC & OIH
Lynne,
Federal law says you can't do it.....
Donna J. Perrone, EA
203-469-4939
203-468-2038 fax
IRS Circular 230 Disclosure: Unless expressly stated otherwise, any tax advice contained herein, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of (1) avoiding tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions, or (2) promoting, marketing or recommending to another party any tax-related matters addressed herein.
From:
Sent: Tuesday, October 28, 2008 2:53 PM
To:
Subject: Re: [taxchat] Husband-Wife LLC & OIH
drake allows you to put J on a sched c, & the 8829 automatically goes to the sched c also, but will create 1 SE's for each spouse. WI doesnt say it "wont" allow h/w llc's, so my guess is, you can file a joint sched C if state law allows it.
lynne
Mel Wolfson wrote:
I believe that an LLC can not elect to be treated as two Schedule Cs.
IRS Circular 230 Disclosure: Unless expressly stated otherwise in this transmission, any tax advice contained herein, forwarded with or attached to this message was not and is not intended to be used, nor may it be relied upon or used, by any taxpayer for the purpose of (1) the avoidance of any tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions, or (2) promoting, marketing or recommending to another party any tax transaction or tax-related matters that may be addressed herein.
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