Partnership to Schedule C

[TaxGuyBill]

If they live in a community property state, an LLC can report on two Schedule C's as a "Qualified Joint Venture".

However, Revenue Procedure 2002-69 Section 4.02 states: "A change in reporting position will be treated for federal tax purposes as a conversion of the entity."

http://www.irs.gov/pub/irs-drop/rp-02-69.pdf



However, I'm not entirely sure what that means.

[jsamans]

[url]They would need to dissolve that LLC (partnership taxed) and then transfer the assets to the new QJV that they form.

In doing so, they would lose the liability protections associated with the LLC structure and become two sole proprietors, correct?

[ATSMAN]

http://www.irs.gov/Businesses/Small-...ted-Businesses

Unfortunately they can not simply convert from a LLC to qualified joint venture.

They would need to dissolve that LLC (partnership taxed) and then transfer the assets to the new QJV that they form.

The old EIN can not be transferred so if they need a EIN they will have to apply.

[JoshinNC]

A husband-wife LLC

Can't file two Sch. C's. It does not qualify as a QJV.

[Gary]

I have a client that has an LLC and has been filing as a Partnership with his wife. He would like to change to two schedule Cs. Can he just do this, or does he need to notify the IRS of the change.