Husband/Wife Business self employed

Forum|Forum|2 years ago
October 9, 2023
1 reply
0 views

Hello,

If a husband & wife run a business together but have different roles and different % of earnings, how does this work? One is 60 other is 40. (Husband started business and wife joined later years.)

1. Does business description need to be the same for both of them even if they have different roles in the company?

2. Do they split ALL expenses using % of each individual?

3. Can business description be changed say from Online Marketing one year to Digital Marketing the next year and what is the best Principle Business Code to use?

Thank you for help!!

Not A Product Question

VolvoGirl

Employee

Here are your options for filing Schedule C in your personal 1040 tax return:

1. MFJ, one spouse claiming all the Schedule C income and all the SE tax credits.

2. MFJ 2 schedule Cs, one for each spouse with half the income and expenses on each schedule C and each getting SE tax credit.

3. MFS, each spouse claiming half or their separate share of income and SE tax credits.

4. MFS one spouse claiming all the schedule C income and expenses and all the SE tax credit.

For a Qualified Joint Venture, To make this election, divide all items of income, gain, loss, deduction, and credit attributable to the business between you and your spouse based on your interests in the business. Each of you must file a separate Schedule C, C-EZ, or F.

Or Buy Turbo Tax Business and file a 1065 partnership tax return, then enter your K-1's into your Joint or Separate personal tax returns.

Here's some IRS info.....

IRS info on Husband & Wife joint venture

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Election-for-Husband-and-Wife-Unincorporated-Businesses

Husband and wife joint business

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Husband-and-Wife-Business

MarketingcoachAuthor

OK so we are filing jointly and want to share expenses and income and your saying we have to do a 50/50 split of both in order to file together for a joint venture? Can't do 60/40 if MFJ Is what you're telling me correct?