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Category: Schedule C - Profit or Loss From Business

Joint Venture On A Schedule C

A taxpayer and spouse may elect to report business income from an unincorporated business on Schedule C as a joint venture instead of as a partnership for federal tax purposes.  A joint venture is considered qualified if all of the following apply:

  • The only owners of the business are the taxpayer and spouse,
  • BOTH spouses materially participate in the trade or business,
  • A joint return is filed for the tax year, and
  • BOTH spouses elect to have the provision apply.

In order to properly calculate each individual's share of income and expenses, the IRS requires that the taxpayer and spouse file separate Schedule C's and Schedule SE's.  On each Schedule C, preparers will separate the income and expenses based on each spouse's participation in the venture.  For example, if the husband owns 59% of the joint venture and the wife owns 41%, the income and expenses should reflect that.

Additional Links:
Schedule C Instructions
Election for Taxpayer and Spouse Unincorporated Businesses

Last Updated: 10/11/2016

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