LLC Income Tax: Filing as a Sole Proprietorship

Filing your LLC income tax is a relatively simple process. Unlike a corporation, an LLC is not treated as a separate tax entity. It is more of a pass-through organization, and taxes are filed accordingly.

Single Owner LLC’s

A one member LLC is treated as a sole proprietor under IRS rules. This means that you will file on the standard 1040C and report all profits and losses to the IRS there. Even if you do not withdraw any profits at the end of the year and you leave them for reserves, the LLC income tax is still due.

Complete Your Tax Return

You will complete your tax return at the end of the year as you normally would, except you would follow these steps:
  • Complete form 1040 according to IRS instructions
  • Complete Schedule 1040C according to IRS instructions and enter appropriate amounts where required on the form 1040
File Your Return

The due dates for your LLC income tax are the same as any standard tax return. This due date is generally April 15th of each year, unless you have filed for permission from the IRS to file your tax returns on a different date.
  • Complete and sign your return
  • Mail to the IRS address according to the state in which you live
Don’t Forget the State!

Check your state rules regarding LLC’s. Many will follow the same rules that the IRS has in place, however, some states tax the LLC as a separate entity. Don’t forget to file the state returns, which carry the same due dates as set forth by the IRS.
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