Guidance for Special Types of Businesses

Special Rules for Certain Business Structures

Special Provisions for a Limited Liability Company (LLC)

An LLC is an entity formed under state law by filing articles of organization as an LLC.

None of the members of an LLC are personally liable for its debts.

An LLC can be classified as either a partnership or a corporation for federal income tax purposes. See Corporation, for the rules you must use to determine whether an LLC is treated as a corporation. If an LLC is not treated as a corporation and has 2 or more members, it is treated as a partnership. Depending on its classification, an LLC would file either Form 1065 or Form 1120. However, if an LLC has a single owner, it would file Schedule C or C-EZ (Form 1040).

If an LLC is treated as a partnership, see Publication 541 for information on partnerships.

If it is treated as a corporation, see Publication 542 for information on corporations.

 

Important References:

Publication 541                                      Partnerships
Publication 542                                      Corporations
Form 1065                                              U.S. Partnership Return of Income
Form 1120                                              U.S. Corporation Income Tax Return
Form 1040 Schedule C                         Profit or Loss from Business
Form 1040 (C-EZ)                                  Net Profit from Business