trust owned llc vs partnership llc filing

mosparks

Would transferring our LLC interest (married 50/50 member managers, non community property state, currently required to file partnership 1065) to a revocable living trust, allow us to elect and file as a Disregarded Entity single member llc moving forward? Would this trust owned llc require filing 1041 or allow us to use 1040 schedules moving forward?

AleceN

If you and your spouse are the only partners, you can transfer your LLC interest to a Single-Member LLC. (https://www.irs.gov/businesses/small-businesses-self-employed/single-member-limited-liability-companies)

When filing a Revocable Trust, the tax liability falls on the grantor or creator of the trust. Therefore, you would file the trust income on your personal taxes with a 1040. However, irrevocable trusts need to be filed with a 1041. (https://www.irs.gov/instructions/i1041#en_US_2023_publink1000285939)