Can husband and wife with multi-member LLC in community property state file as QJV? Getting different info...

You're hitting on a common point of confusion. Let me clarify this for you. In general, the IRS rule is correct - if you've formed an LLC, you typically can't file as a Qualified Joint Venture (QJV). The QJV election was designed for couples who operate an unincorporated business together. However, there is nuance for community property states like Arizona. In a community property state, married couples who own an LLC can choose to be treated as a "disregarded entity" for federal tax purposes if the LLC is wholly owned by the spouses. But this isn't technically using the QJV provision - it's a different tax treatment. With a disregarded entity in a community property state, you would typically file Schedule C (for each spouse's share) with your joint return rather than filing a partnership return. Each spouse would report their share of income/expenses and pay self-employment taxes on their portion. I recommend consulting with a tax professional familiar with your state's specific rules, as there are some tricky reporting requirements that vary by state.

After researching this exact question for my wife and me (we have an LLC in Texas - also community property), I discovered taxr.ai https://taxr.ai which analyzed our LLC docs and tax situation. The tool showed we could indeed treat our LLC as a disregarded entity rather than a partnership since we're in a community property state. The key difference from QJV is that with community property rules, each spouse is automatically considered to own 50% of community property, including business interests. The tool explained that while we couldn't technically use the QJV election (which is for unincorporated businesses), we could achieve similar tax treatment through community property rules.

I wanted to follow up about my experience with taxr.ai after being skeptical initially. I decided to try it with our Washington state LLC situation, and I'm honestly surprised at the depth of analysis it provided. The tool explained that in Washington (as a community property state), our LLC could indeed be treated as a disregarded entity despite being technically multi-member. It provided specific references to Revenue Procedure 2002-69 which addresses this exact situation. The analysis showed me exactly how to report our income on Schedule C forms instead of the more complicated partnership return. It even highlighted potential pitfalls specific to Washington state community property laws that could affect our tax treatment. What impressed me most was the detailed explanation of how this differs from a QJV election, which cleared up my confusion completely. Definitely saved us time and headache!

I had the EXACT same question last year with our Nevada LLC. After 4 attempts calling the IRS (kept getting disconnected), I found this service called Claimyr https://claimyr.com that got me connected to an actual IRS agent in about 20 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed that in community property states, husband-wife LLCs can indeed be treated as disregarded entities rather than partnerships. She explained it's not technically using the QJV election (which is for unincorporated businesses only), but the end result is similar - we can file Schedule C instead of the partnership return. This saved us from having to pay a preparer for a complicated partnership return and the additional self-employment tax complications.

I have to admit I was completely wrong about Claimyr. After my skeptical comment, I decided to try it because I was desperate for answers about my Idaho LLC situation. Within 15 minutes I was talking to an actual IRS tax specialist who knew exactly what I was asking about. The agent confirmed that in Idaho (community property state), my husband and I can treat our LLC as a disregarded entity and file Schedule C instead of partnership returns. She explained this is different from a QJV which is only for unincorporated businesses. She also sent me information about Revenue Procedure 2002-69 which specifically addresses this situation. I've been fighting with this question for months and spent hours on hold. Should have tried this service sooner - would have saved me so much stress and confusion!

I'm a tax preparer in Washington state and deal with this specific situation often. The confusion comes from two different IRS provisions that sound similar but work differently: 1. QJV election: For UNINCORPORATED businesses only (not LLCs) where spouses can elect to file as a joint venture instead of a partnership. 2. Community property state exception: Spouses in community property states with LLCs can treat their entity as disregarded (each filing Schedule C) under Rev. Proc. 2002-69. If you've formed an LLC, you're looking at option #2, not QJV. The end result (filing Schedule Cs) might seem similar but the legal basis is different. One warning though - if you've been filing as a partnership and switch to disregarded entity treatment, that's technically a liquidation of the partnership which could have tax consequences. Get professional advice for that transition.

Has anyone done this in California specifically? My wife and I have an LLC but have been filing partnership returns. Our accountant never mentioned we had this option and we've been paying extra for the partnership returns every year.