What Documents Do I Need to File My LLC Taxes

Key Takeaways

• All LLCs must file a tax return—even if they had no income.
• The documents needed to file taxes depend on the LLC’s classification (sole proprietorship, partnership, or corporation).
• Common documents include financial statements, EIN, prior-year returns, and IRS forms like Schedule C or Form 1065.
• Multi-member LLCs and LLCs taxed as corporations face different filing rules and deadlines.
• State-specific filing requirements and annual franchise taxes may also apply.
• Hiring a tax professional or using tax software can help avoid costly errors.
• You can find experienced attorneys on UpCounsel for help filing LLC taxes.

Does an LLC need to file a tax return? The answer is yes, even if a limited liability company (LLC) is inactive, meaning it has incurred no expenses or earned any income for the year. Even in these scenarios, the LLC will most likely still be required to file a tax return. 

Information About Filing a Tax Return for an LLC

• Filing as an LLC allows you more flexibility when determining how business earnings will be taxed by the Internal Revenue Service (IRS).
• The choice you make in how your business is taxed determines the tax rules your business will be subject to.
• With an LLC, there are no set rules in place. Per the IRS you are allowed to use tax rules applicable to those used for a sole proprietorship, corporation, or partnership.
• A corporation is considered a separate entity, unlike an LLC, which is considered by the IRS to be a "pass-through entity" the same as a sole proprietorship or partnership.
• As a "pass-through entity," the profits are passed on to the owners, also referred to as members, of the LLC who will then file the profit figure with their personal taxes.
• While an LLC itself is not charged with the task of paying federal income taxes, there are states that charge the LLC with a tax.

What Documents Do I Need to File My LLC Taxes?

The documents you need to file your LLC taxes depend on how your LLC is taxed. Below are common records and forms required by the IRS and state agencies:

General Documents for All LLCs

• Employer Identification Number (EIN): Required for multi-member LLCs and LLCs with employees.
• Operating Agreement: Not required for taxes but useful if ownership questions arise.
• Prior-Year Tax Returns: Helps track deductions and ensure continuity.
• Financial Statements: Include profit and loss statements, balance sheets, and bank account summaries.
• Receipts and Invoices: Necessary to document business expenses and income.
• Payroll Records: If you have employees, keep records of wages paid and employment tax filings.
• Business Mileage Log: For vehicle-related deductions.

Tax Forms Based on LLC Classification

• Single-Member LLC (Disregarded Entity):
  • IRS Schedule C (Profit or Loss from Business), attached to the owner’s Form 1040
  • Schedule SE (Self-Employment Tax), if applicable
• Multi-Member LLC:
  • Form 1065 (U.S. Return of Partnership Income)
  • Schedule K-1s for each member
• LLC Taxed as a Corporation:
  • Form 1120 (C Corporation) or 1120-S (S Corporation)
  • W-2s, W-3s, 940, 941 for payroll reporting
  • Depreciation and amortization schedules (if applicable)

To fully answer “what documents do I need to file my LLC taxes,” it’s also important to gather state-specific documentation such as annual report filings or franchise tax forms, depending on your location.

Differences in Tax Elections for LLCs

An LLC that has one owner (member) is automatically disregarded for federal income tax by the IRS. In this case, the single owner/member would report the income and expenses of the LLC on their personal tax return. 

For LLCs operating with more than one owner, the IRS recognizes the business as a partnership. In this situation, an informational partnership tax return is filed by the LLC, and owners (members) file expenses and income on personal tax returns. 

If the owner needs to change the classifications, taxes can be filed as a corporation. When the business is formed, the classification can be chosen at that time, or at any time in the future. To do it after the business is formed requires Form 8832 be filed with the IRS.

For an LLC that retains a significant amount of its profits within the business, corporate taxation is a benefit. Taxes for the LLC are taxed based on the rate for corporations, and owners are not taxed on their personal income tax on profits retained by the company. 

If you convert your limited liability company to a corporation, for five years you will be ineligible to convert back to pass-through taxation.

Deadlines and Filing Requirements by Tax Status

Your LLC’s tax classification determines the tax return deadlines:

• Single-member LLC: File with your individual return (April 15, or the following business day)
• Multi-member LLC: Form 1065 is due by March 15
• S Corporation (Form 1120-S): Due by March 15
• C Corporation (Form 1120): Due by April 15

Extensions can be requested using Form 7004, but estimated taxes may still be due by the original deadline.

Note: If your LLC operates in multiple states, you may be required to file returns in each state where you conduct business.

Reasons to File a Separate LLC Tax Return

• An LLC is the most common business type formed. Many are owned by a single person or in some cases a married couple. With married couples living in a community property state, the LLC is still considered owned by one person.
• Some owners find it more convenient that the IRS treats an LLC as a "pass-through entity" or "disregarded entity" since the IRS does not want a separate tax return filed by an LLC. The IRS is fine with the income and expenses from the LLC being reported on the single member's personal tax return.
• If the LLC is owned by two people with one being someone other than a spouse, it is a multi-member LLC and a separate tax return must be filed. For some owners, filing a separate tax return comes across as more professional.
• A multi-member LLC would usually file taxes as a partnership unless the owners have chosen to have the LLC treated as a corporation.
• For financial transactions from a lender, it may be requested that the LLC file a separate tax return to qualify for a business loan.
• Should you need to apply for financial aid from the state, filing a separate tax return may have an impact on your eligibility.
• Ensuring the protection of assets is another reason for forming an LLC and the most common. It is another option to provide legal protection to the business.
• When looking at the percentage of audits by the IRS, personal tax returns are at a higher risk of being audited than corporations or partnerships.
• With direction from a tax professional, LLCs can provide tax savings in certain situations, which would be looked at by the tax expert on a case-by-case basis. 

Consequences of Not Filing an LLC Tax Return

Failure to file your LLC’s tax return can result in serious financial penalties and loss of good standing:

• Penalties for late filing:
  • For Form 1065, $220 per member per month, up to 12 months
  • For Schedule C, individual late filing penalties apply
• Interest on unpaid taxes
• Potential audit triggers due to incomplete records
• Revocation of S Corporation election, if late or incorrect
• Loss of limited liability protection if the LLC is dissolved by the state for non-compliance

To avoid these issues, keep your financial records organized and consult a tax professional.

Frequently Asked Questions

1. What documents do I need to file my LLC taxes as a sole proprietor?
   You’ll need Schedule C, your EIN (if applicable), income and expense records, and possibly Schedule SE for self-employment tax.
2. Does my LLC need to file taxes if it made no income?
   Yes, even a zero-activity LLC typically must file a return to maintain good standing and avoid penalties.
3. Can I file LLC taxes myself, or do I need an accountant?
   You can file yourself using tax software, but complex situations—like multi-state operations or corporate elections—often benefit from professional help.
4. Do I need to file state tax returns for my LLC?
   In many states, yes. States may require an income tax return, franchise tax report, or annual filing. Check with your state’s tax agency.
5. What is the deadline to file LLC taxes?
   Deadlines vary: March 15 for multi-member and S Corp LLCs, April 15 for single-member or C Corp LLCs. Extensions are available, but not for payments due.

If you need help with understanding why an LLC needs to file a tax return, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.