Instructions For Schedule C (2015) (Page 2 of 18) in pdf

Form 4797 to report sales,

turns for details and other payments that

gain, loss, deduction, and credit attribut-

exchanges, and involuntary conversions

may require you to file a Form 1099.

able to the business between you and

(not from a casualty or theft) of trade or

your spouse based on your interests in

If you received cash of more than

the business. Each of you must file a

business property.

$10,000 in one or more related transac-

separate Schedule C, C-EZ, or F. Enter

Form 6198 to figure your

tions in your trade or business, you may

your share of the applicable income, de-

allowable loss if you have a business

have to file Form 8300. For details, see

loss and you have amounts invested in

duction or (loss), on the appropriate

Pub. 1544.

the business for which you are not at

lines of your separate Schedule C, C-EZ,

Business Owned and

risk.

or F. Each of you may also need to file a

Operated by Spouses

separate Schedule SE to pay self-em-

Form 8582 to figure your

ployment tax. If the business was taxed

allowable loss from passive activities.

Generally, if you and your spouse joint-

as a partnership before you made the

Form 8594 to report certain

ly own and operate an unincorporated

election, the partnership will be treated

purchases or sales of groups of assets

business and share in the profits and los-

as terminating at the end of the preced-

that constitute a trade or business.

ses, you are partners in a partnership,

ing tax year. For information on how to

Form 8824 to report like-kind

whether or not you have a formal part-

report the termination of the partnership,

exchanges.

nership agreement. You generally have

see Pub. 541.

Form 8829 to claim actual

to file Form 1065 instead of Schedule C

expenses for business use of your home.

Revoking the election. The election

or C-EZ for your joint business activity;

Form 8903 to take a deduction for

can be revoked only with the permission

however, you may not have to file Form

income from domestic production

of the IRS. However, the election re-

1065 if either of the following applies.

activities.

mains in effect only for as long as you

You and your spouse elect to be

and your spouse continue to meet the re-

Singlemember limited liability com

treated as a qualified joint venture. See

quirements to make the election. If you

pany (LLC). Generally, a single-mem-

Qualified Joint

Venture, next.

and your spouse fail to meet the require-

ber domestic LLC is not treated as a sep-

You and your spouse wholly own

ments for any year, you will need to

arate entity for federal income tax

the unincorporated business as commun-

make a new election to be treated as a

purposes. If you are the sole member of

ity property and you treat the business as

qualified joint venture in any future

a domestic LLC, file Schedule C or

a sole proprietorship. See

Community

year.

C-EZ (or Schedule E or F, if applicable)

Income, later.

unless you have elected to treat the do-

Otherwise, use Form 1065. See Pub. 541

Employer

identification

number

mestic LLC as a corporation. See Form

for more details.

(EIN). You and your spouse do not

8832 for details on making this election

need to obtain an EIN to make the elec-

Qualified Joint Venture

and for information about the tax treat-

tion. But you may need an EIN to file

ment of a foreign LLC.

other returns, such as employment or ex-

You and your spouse can elect to treat

cise tax returns. To apply for an EIN,

Singlemember limited liability com

an unincorporated business as a quali-

see the Instructions for Form SS-4.

panies (LLCs) with employees. A sin-

fied joint venture instead of a partner-

gle-member LLC must file employment

Rental real estate business. If you and

ship if you:

tax returns using the LLC's name and

your spouse make the election for your

Each materially participate in the

employer identification number (EIN)

rental real estate business, you must

business (see

Material

participation, lat-

rather than the owner's name and EIN,

each report your share of income and

er, in the instructions for line G),

even if the LLC is not treated as a sepa-

deductions on Schedule E. Rental real

Are the only owners of the busi-

rate entity for federal income tax purpo-

estate income generally is not included

ness, and

ses.

in net earnings from self-employment

File a joint return for the tax year.

subject to self-employment tax and gen-

Heavy highway vehicle use tax. If you

Making the election will allow you to

erally is subject to the passive loss limi-

use certain highway trucks, truck-trail-

avoid the complexity of Form 1065, but

tation rules. Electing qualified joint ven-

ers, tractor-trailers, or buses in your

still give each of you credit for social se-

ture status does not alter the application

trade or business, you may have to pay a

curity earnings on which retirement ben-

of the self-employment tax or the pas-

federal highway motor vehicle use tax.

efits, disability benefits, survivor bene-

sive loss limitation rules.

See the Instructions for Form 2290 to

fits, and insurance (Medicare) benefits

find out if you must pay this tax and vis-

More information. For more informa-

are based. In most cases, this election

for the most re-

tion on qualified joint ventures, go to

will not increase the total tax owed on

cent developments.

IRS.gov and enter “qualified joint ven-

the joint return.

ture” in the search box.

Information returns. You may have to

Jointly owned property. You and your

file information returns for wages paid

spouse must operate a business to make

Community Income

to employees, certain payments of fees

this election. Do not make the election

and other nonemployee compensation,

for jointly owned property that is not a

If you and your spouse wholly own an

interest, rents, royalties, real estate trans-

trade or business.

unincorporated business as community

actions, annuities, and pensions. See

property under the community property

Making the election. To make this

Line

I, later, and the 2015 General In-

laws of a state, foreign country, or U.S.

election, divide all items of income,

structions for Certain Information Re-

C-2

Instructions For Schedule C (2015) Page 2

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