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Old 02-26-2017, 10:01 AM
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Question Private investing business

In 2015 we filed a new LLC for trading our own Forex account as a business. As such, we have no product or service. Is the schedule C the correct form for such a business? If it is, how do we classify it? We do have expenses related to business.

The LLC was formed in 2015 but no business was transacted until 2016.



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Old 02-26-2017, 10:43 AM
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In 2015 we filed a new LLC for trading our own Forex account as a business. As such, we have no product or service. Is the schedule C the correct form for such a business? ====>it depends; limited liability company, or LLC, is formed under state law but is not recognized as a business classification by the IRS. An LLC must choose how it will be taxed by electing treatment as a sole proprietorship or a corporation, if it is a single-member LLC, or as a partnership or a corporation, if it is a multi-member LLC. You need to file SCh C of 1040 aslognas your LLC is one owner sole proprietorship or SMLLC iif not, you need to fie form 1065; you need to complete and file IRS Form 1065, a Sch K-1 to all members if your LLC has elected to be taxed as a partnership. A partnership is a pass-through entity, meaning the partnership doesn't pay federal income taxes itself. The business passes profit and loss through to its owners. The owners record their proportionate share on their personal income tax return and pay taxes on it at the individual rate. Form 1065 is an information return that allows the business to prepare and distribute a Sch K-1 to each owner. The K-1 is the partnership equivalent of a W-2.and you need to cinoem/loss on sch k1 on sch e or sch d or etc.and finally on your 1040

If it is, how do we classify it? We do have expenses related to business. ====>Asa SMLLC you can claim then on sch C of 1040 as a MMLLC as a partnership I mean you need to claim then on form 1065 or SCh K of 1065.



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Old 02-26-2017, 11:09 AM
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I got an email saying that I had a reply to this question but when I open the link there is no reply.



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Old 02-26-2017, 04:32 PM
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Quote:
Originally Posted by jcorbett View Post
I got an email saying that I had a reply to this question but when I open the link there is no reply.
now you can open the link to read the response



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Old 02-27-2017, 08:10 PM
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Originally Posted by jcorbett View Post
I got an email saying that I had a reply to this question but when I open the link there is no reply.
Thank you for your reply. It helps me decide which way to proceed. That would be to reclassify the business an SMLLC. I have no profit or payout to show on the sch. k1 so for now a partnership just doesn't seem worth the hassle. When I do finally get into the green I can use my wife as an employee and that will defer the double taxation thing.

I have always filed my own returns even when I have had rental properties and other home based businesses. This year I am thinking of getting a CPA to do it because with no product or service this is not a typical business.



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