They do not physically live in Texas, because they are military they are able to elect where their taxes are filed (in line with the military requirements), so they have been doing so in Texas for several years now.

My biggest questions -

1. Because their joint rental property LLC is in Oklahoma (non-community property state), do I have to file their Oklahoma state return as a partnership? If I do, would we just issue themselves K-1s splitting everything 50/50 and then file Form 1065 in Oklahoma for the partnership? Is there anything that the entity itself has to file with the state?

2. Because they file their 1040 federal return in Texas (community property state), am I able to file the LLC as a disregarded entity at the federal level even though the LLC flowing through to their return is operating in Oklahoma as a partnership?

I've never come across this scenario before, but at the end of the day it's my understanding that there shouldn't be a dollar impact either way that I file, but I do want to ensure that I'm filing everything correctly. Any help or input is greatly appreciated!