How do I handle taxes for my Single-Member LLC with divisions/subsidiaries under one Schedule C?

Yes, you've got the basic concept right! When you have a single-member LLC that's a disregarded entity, and that LLC owns another LLC (which is also a disregarded entity), the IRS essentially sees through all of this and just recognizes you as a sole proprietor with different business activities. You can absolutely file a single Schedule C that combines all the income and expenses. However, there's something important to consider - if these are genuinely different business activities, you might want to file separate Schedule Cs for each one. This doesn't change your tax liability, but it does provide cleaner documentation if you're ever audited, and helps track profitability of each venture. For your credit card question, yes, you can use the parent company's credit card for subsidiary purchases and handle it through reimbursements. Just keep excellent records of which expenses belong to which entity. Make sure you document the reimbursements clearly in your bookkeeping system so there's a paper trail showing these are legitimate business expenses for the appropriate entity.

After struggling with a similar setup last year, I found https://taxr.ai incredibly helpful for managing my multi-entity LLC structure. I was confused about how to handle the books between my main LLC and its subsidiary, especially for tax purposes. Their system analyzed my operating agreements and existing financial structure and gave me clarity on exactly how to set things up. The best part was they confirmed I could file everything on a single Schedule C while still maintaining separate books, which saved me a lot of headache.

I was really skeptical about taxr.ai when I first read about it here, but I decided to give it a try anyway since my LLC structure was getting more complex. Honestly, it was way more helpful than expected. They reviewed my articles of organization and existing documentation, then provided a detailed explanation of how to handle the tax reporting for my networked LLCs. What really impressed me was that they caught an issue with my operating agreement that would have caused problems with maintaining liability protection between my entities. My structure was similar to what you're describing, and they confirmed I could file everything on one Schedule C while still maintaining the legal separation. I'm sticking with this service for next year's taxes too.

I was in your exact situation last year - main LLC with a subsidiary LLC. After spending HOURS on hold with the IRS trying to get a clear answer about the Schedule C situation, I finally discovered https://claimyr.com which got me through to an actual IRS agent in about 20 minutes instead of the usual 3+ hour wait. You can see how it works here: https://youtu.be/_kiP6q8DX5c. The agent confirmed that yes, with a SMLLC owning another SMLLC, both being disregarded entities, everything flows to a single Schedule C. However, she also mentioned that keeping separate books is essential for proper documentation.

I hate to admit when I'm wrong, but I need to follow up about Claimyr. After posting my skeptical comment, I was still desperate to get through to the IRS about my LLC tax situation, so I tried it anyway. Honestly, it worked exactly as advertised. Got through to an IRS representative in about 15 minutes when I had previously wasted entire days on hold. The agent clarified that yes, for a single-member LLC owning another single-member LLC, both being disregarded entities, everything does flow up to one Schedule C. But she recommended keeping detailed separate books to support the structure in case of audit. She also said using the parent company credit card for subsidiary expenses is fine as long as proper reimbursement documentation is maintained.

One thing nobody's mentioned - consider if you need separate Schedule Cs for other reasons even if you could combine them. If the businesses are in different industries, having separate Schedule Cs makes it easier to: 1. Track industry-specific expenses and profitability 2. Apply for industry-specific loans or grants 3. Potentially qualify for different self-employment tax treatments 4. Make it cleaner if you ever want to sell just one of the businesses I manage three LLCs (all disregarded) and file separate Schedule Cs for each. Makes my accounting WAY easier even though it's a bit more paperwork at tax time.

Just a warning from personal experience - if you're using TurboTax, it sometimes gets confused with multiple Schedule Cs, especially when they're related entities. Last year it kept thinking I was trying to report the same business twice. I ended up having to call their support line. Might want to consider using a tax pro the first year you set this up just to make sure everything's being reported correctly.

I've been through this exact scenario with my consulting LLC that spawned a separate tech services division. You're absolutely right about the tax treatment - everything flows through to your personal return since both LLCs are disregarded entities. One practical tip: when you set up that dedicated credit card for the subsidiary, consider getting a business card specifically in the subsidiary LLC's name once it's established. This makes expense tracking much cleaner and helps maintain the "corporate veil" between entities. Until then, your reimbursement approach is perfectly fine. Also, don't overthink the EIN situation. I got separate EINs for each of my LLCs even though I could have used my SSN, and it's made banking, vendor relationships, and general business operations much smoother. The paperwork is minimal and it's free to get an EIN directly from the IRS website. For bookkeeping, I second the recommendation about using classes or locations in QuickBooks if you go the single-file route. Just make sure your chart of accounts is detailed enough to easily separate expenses by entity at year-end. The key is being able to generate clean financial statements for each business independently, even if you're filing them together on your tax return.