Is Schedule E and/or C required?

Question

Hi All, I have an LLC and recently completed my K1 return for my LLC. My question is, for my personal tax return, do I need to complete the Schedule E and/or Schedule C? Or is this not required for my personal return, and I can just file my regular W2 info (this is all I did, as it's my first year having my multifamily REI LLC and was not certain) ?

If anyone is experienced here I'd appreciate the advice! Thank you

Michael Plaks · Answer

I have to assume that you prepared a partnership tax return (Form 1065) for your LLC. This form shows your LLC's total profit or loss. But the LLC does not pay any taxes. It transfers this result to the partners via Form K-1 which is created as part of the partnership return. (If this is not what happened - stop and hire a pro.)

Let's say your total profit for the LLC was $2,000 after expenses. Then each partner gets a K-1 showing $1,000 profit attributed to him or her. This $1,000 must be listed on your personal tax returns. Where it goes depends on the nature of the profit. Most of the time, it ends up on page 2 of Schedule E. Different numbers can end up on Schedule D, Schedule B and some other places, but never on Schedule C. Your tax software will place it where it belongs once you complete the K-1 worksheet inside your software. If you're trying to do it by hand - good luck, I would not attempt it.

If your LLC partner was your spouse, you probably did not need a separate LLC tax return at all. But that is an entirely new conversation.

Matt Ward · Answer

@Brian S. What’s a K1 return?

Ashish Acharya · Answer

Your information form k-1gets to various schedules and forms in your personal return. Schedule E is one of them. It is generally never going to be sch C.

Look at the instructions for page 2of schedule E.

Other forms ( eg 4562) might also be required if other separately stated items are being passed through the K-1.

Let us know if you have any question

Brian S. · Answer

I am capable of filing, just unsure whether Schedule E or C is required for my personal return if already filing K1 for my group's LLC.

Anyone who may know, it is greatly appreciated!

Bill Hampton · Answer

@Brian S.

Based on your questions I suggest that you hire a professional to complete your tax return.

Good luck and let me know if I can be of assistance.

Brian S. · Answer

It is a 2 member LLC.

Thoughts?

Wayne Brooks · Answer

Assuming you are a single member llc, I don’t believe there is a K1.....the llc rental income goes on schedule E on your tax return....it’s as if the llc does not exist...”the llc income passes through to your personal tax return” , the llc doesn’t file a return.