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I need to file tax extensions.

I already know I need to file Form 4868: Application for Automatic Extension of Time To File U.S. Individual Income Tax Return. I expect a refund, so I'm sending no payment with this.

However, my wife and I have two LLCs. We're the only members: we each have a 50% interest in each.

An extension to file these would be through Form 7004: Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns. Taken by themselves there would be profit on them that would pass through to us on our 1040, but, again, we are expecting a refund overall.

I've found elsewhere that single-member LLCs only need to file Form 4868, because (link):

Single member LLCs only need to file for a personal tax extension (IRS Tax Form 4868), which will extend both the personal and business tax deadline, since your LLC is a "pass-through entity" and your business tax return is part of your 1040 personal tax return on Schedule C.

This is basically the same situation my wife and I have -- it's our LLC, and passes through to our joint return.

I don't know if this is pertinent or not, but we have not made any election to become a disregarded entity.

Do I need to file form 7004 for our LLCs? I'd prefer not to, because I'd likely need to pay estimated taxes that would be refunded once our individual return goes through. Or maybe I'm missing the correct reason entirely.

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  • I have an IRS clarification in fron of me. Part III 26 CFR 301.7701-3 Classification of certain business entities. Rev. Proc. 2002-69 Essentially says LLC's wholly owned by husband and wife can also be treated as disregarded entities. This eliminates the need for a 1065, and also the 7004 extension. I have unfortunately already filed a 7004 extension, and expect that the filing of the 7004 will now cause me additional concerns since I will not be filing a 1065.
    – David N
    Commented Aug 4, 2021 at 16:15

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Since you both are members of the LLC - it is not a single-member LLC, thus you have to file the tax return on behalf of the LLC (I'm guessing you didn't elect corporate treatment, so you would be filing 1065, which is the default).

You need to file form 4868 on behalf of yourselves as individuals, and form 7004 on behalf of the LLC as the partnership.

Since the LLC is disregarded (unless you explicitly chose it not to be, which seems not to be the case) the taxes will in fact flow to your individual return(s), but the LLC will have to file the informational return on form 1065 and distribute K-1 forms to each of you. So you wouldn't pay additional estimated taxes with the extension, as you don't pay any taxes with the form 1065 itself.

If you need a help understanding all that and filling the forms - do talk to a professional (EA or CPA licensed in your state).

Also, reconsider not sending any payment. I suggest sending $1 with the extension form even if you expect a refund.

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