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June 8, 2019
Question

Hi, my wife and I live in NJ always filed our returns together, we both have jobs, my wife opened an LLC as only owner. How should we file 2019 taxes, I have my own job?

  • June 8, 2019
  • 1 reply
  • 0 views

like I said, my wifes' LLC is regular, (not C or S type) 

I do not work in her LLC

how is this going to affect us now? 

We both have jobs, we used to file married filing jointly

    1 reply

    June 8, 2019
    As a single member LLC, your wife is considered a ‘sole proprietor’ (and the LLC is a ‘entity disregarded as separate from its owner’ unless she filed Form 8832 with the IRS to be treated as a corporation).
    As a ‘sole proprietor’, then you can still file as married filing jointly and she will report her business net income on Form 1040 Schedule 1, line 12 for Schedule C business income associated with her business.  Also, she can consult with a tax advisor about business deductions and a self-employed retirement plan (such as SEP-IRA) deductions if she has a profit in the business and no other employer sponsored plans (i.e., no other job in addition to her LLC).  She will be responsible for paying self-employment tax and that will be factored in on your tax return.  I would recommend using Turbo Tax Home & Business software if preparing your own tax return next year as it will walk you through many of the tax issues related to her new small business.