JRC
Level 8

Husband and Wife and (Spouses) LLC's in "Marital Property States" may treat the LLC as a disregarded entity. Either way I would look at the advantages of doing either for the client.

The IRS has issued a special rule applicable to LLCs owned by married couples who live in community property states. Under this rule, a married couple can treat their jointly owned business as a disregarded entity for federal tax purposes if: ... the business is not otherwise treated as a corporation under federal law.