What is the name of your state? PA
Ok if I have done my Research correctly then.....
Regardless of how an LLC is Treated, weather it be treated as a sole proprieter or as a multi member corporation, the members will be paying the self Employment tax. correct?
Is there any benefit to filing on a 1065 rather then a Schedule C if you are registered as a single owner?
No, that is not correct.
A single member LLC can be a disregarded entity (a schedule C still filed) or can elect to be taxed as an S-corp. If the LLC elects to be taxed as an S-Corp then as long as the single member receives a reasonable wage for the work that they perform, with proper withholding and social security and medicare taxes withheld/paid, then any remaining profits would not be subject to self employment tax.
In addition, whether taxed as a partnership or as an S-corp, non active partners (limited) or members would not be subject to self employment taxes.
In general, its usually wiser for a single member LLC to be treated as a disregarded entity and a schedule C be filed, but that would/could change if the company experiences significant growth.
Example:
A two member LLC (husband and wife). Wife is NOT active in the LLC. The LLC elects to be taxed as an S-corp. The LLC has 40k in profits, after paying the husband a wage (with proper withholding) of 50k. The profits are split between the husband and wife, on schedule K1's and neither is subject to self employment taxes on the profits.
