Start up expense for a partnership

[mike@mglovercpa.com]

I have an LLC – Louisiana, that formed in 2017 with 4 members that has never filed a tax return. They also have had expense that would qualify as set up expense in excess of 2 million and not operating income as of this date.
The members did agree to have the expenses set up as start up cost and amortize them when revenue is generated; however, we are not sure if this election was filed with the IRS. His previous CPA passed away so I am assuming there was not a formal election filed with the IRS.
Can this LLC not file previous returns and is it able to start filing them when revenue is actually generated or do I need to file the past years returns.
Second question, is the discussion between the members to treat expense as start-up expense a valid election
Trying to avoid the sever partnership penalties for not filing ptn return and K-1’s not being issued.

[ATSMAN]

Under Regs. Sec. 1.195-1, a taxpayer is not required to make a separate election statement to deduct startup costs. Such an election is deemed to be automatically made for the tax year in which the taxpayer begins an active trade or business. The taxpayer can forgo the deemed election by clearly electing to capitalize its startup expenditures on a timely filed return for the year the taxpayer begins business in accordance with instructions provided with the tax return.

[TaxGuyBill]

1) Has the business actually opened yet (ready and available for business)?
2) Did the Partnership pay (a) interest, (b) taxes, or (c) qualified R&D costs that would be deductible under Sections 163, 164, or 174 of the Tax Code?

[spanel]

.02 You file the prior returns, the IRS will assess huge penalties for the prior year returns.

Chris