Denver, CO asked in Tax Law for Colorado

Q: What penalties will I receive for submitting taxes as a dual LLC if we were a sole member in 2020?


I recently filed my taxes with a filing agency, and they submitted my taxes as a dual member LLC, but we are a sole member LLC.

Am I going to get automatically audited? How can I protect myself?

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1 Lawyer Answer
D. Mathew Blackburn
D. Mathew Blackburn
  • Licensed in Colorado

A: We are a sole member LLC? That sentence doesn't sound right.

This sounds like a marital partnership.

There's no additional tax or penalty for filing as a partnership vs a Sole-proprietership. Assuming that the partnership return was filed timely.

The difference is that two people are picking up the income instead of one.

If you have an LLC that you run solo and your preparer filed as a partnership with your spouse the difference will be that your spouse is getting credit for 1/2 of the LLC income for last year. It may effect other credits, but I'd need more information.

I would discuss this with the agency and see why this happened, should it be corrected, and what are they going to do to fix it.

The procedures for amending a partnership return are much more complicated than a personal return. You may have to find someone new to amend.

No you won't be automatically audited.

If the return was filed timely there won't be any penalties. If it was filed late the penalty can be waived under certain circumstances.

Really would need more information than you should post online to give you a better answer.

Good luck

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