I have a client (home state of Utah) who created two LLC's with transactions in 2019.  The first LLC purchased a home in Colorado which was subsequently rented for part of the 2019 tax year.  This LLC was co-owned (50/50) by the taxpayer and his wife.  Because Colorado is not a community property state, my understanding is that we cannot file this rental transaction as a disregarded entity directly through the TP's 1040, we must file a separate return for this LLC.  Which then begs the question as to what taxable entity to elect.  My thought is to elect S Corp treatment, with pass through to the TP's personal return, however, no salaries were paid through this LLC, so my concern is that it may appear we are circumventing payment of SE taxes.

The second LLC was co-owned (50/50) by the taxpayer and his brother.  This LLC purchased a Colorado home in 2018 which was then re-sold in 2019 (flip sale).  Same concern as above; if we choose S-corp tax treatment, no salaries were paid to the owners through the LLC.