- June 25, 2018 at 4:01 am #209138
I am helping a friend set up the books up for her company which is listed as an LLC but they are reporting the income on a Schedule C on their 1040. It appears to me that calling themselves an LLC is really for accounting purposes, not taxing purposes, for that they would seem to be conidered a Sole Proprietorship. For the company type in QB Online, which do I choose, LLC or Sole Proprietorship?
Thank you!June 25, 2018 at 4:07 am #209253
If your friend is a single member LLC (one owner), s/he is required to file their taxes on Schedule C. The entity for tax purposes should be the same as it is for accounting purposes so find out what entity she puts on the tax return; it’s either going to be Sole Prop or single-member LLC. In QBO, you have the option to select single-member LLC or Sole prop so just make sure it matches what is indicated on Form 1040.
Hope this helps.