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I want to address this mess, so that someone reading this understands it is a bit of a mess:
"If their original application chose as a Corporation, then you would first complete the 1065"
Nope.
Fed form 1065 is for partnership/multi-member LLC. The partnership/member entity LLC is a State construct, so they are allowed to elect to be treated as a Corporation (which makes them C, or they also elect to be an S Corp).
"and it will generate a K1 for you to use when filing their personal income tax. You would then go onto a 1040 application and enter the K1.. it will generate the forms needed to complete their taxes.. such as a schedule C/SE etc.."
A single-member LLC is a disregarded entity which means treated as if it does not exist for Fed tax filing and is when you use Sched C for the Fed form 1040. Since LLC is a State construct, your State may have different ways to handle this. This is Self-Employed, in that you and your business have no separate entity. You are your business.
A K-1 already is the end result of a separate business entity's tax filing preparation. It won't be used to make a Sched C for the same business.
A partnership/member entity LLC files a Fed form 1065. A C Corp files a Fed form 1120. An S Corp files a Fed form 1120-S. All of these create forms and info that is passed to the individual persons and participant entities (partners, members, shareholders) in that entity for use and consideration in how that business entity affects the personal tax reporting.
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