1. What is a disregarded entity?
  2. Is the owner of a disregarded entity required to file any special form?
  1. What is a disregarded entity?

    A disregarded entity is a business entity that (1) has a single owner, (2) is not organized as a corporation, and (3) has not elected to be taxed as a separate entity for federal tax purposes.

    The owner of a disregarded entity reports the income of the disregarded entity on the owner's return. If an entity is disregarded as a separate entity for federal income tax purposes, it is also disregarded as a separate entity for Wisconsin income tax purposes.

    The most common disregarded entity is a single-member limited liability company (LLC) that reports its income on its owner's return. An example is an LLC wholly owned by an individual and the income of the LLC is reported on Schedule C of the individual's Form 1040 federal tax return.

  2. Is the owner of a disregarded entity required to file any special form?

    An individual, estate, trust, partnership, tax-option (S) corporation, limited liability company (LLC), or corporation filing a Wisconsin return that is the owner of a disregarded entity must complete Schedule DE, Disregarded Entity Schedule. Schedule DE must be submitted with the Wisconsin tax return. For example, individuals must submit Schedule DE with Form 1 or Form 1NPR.

FOR MORE INFORMATION PLEASE CONTACT:

WISCONSIN DEPARTMENT OF REVENUE
Customer Service Bureau
PO Box 8949
Madison, WI 53708-8949
Phone: (608) 266-2486
Email: DORIncome@wisconsin.gov

October 24, 2018