Settings
Starting point
Review your 2025 year-end numbersSet. Your books start from your balances on 2025-12-31.
Your business
Business structure
LockedYour business is a
Partnership
Two or more owners without an LLC. Each owner pays tax on their share.
- Tax return
- Partnership return (Form 1065)
- Owners are called
- partners
- Money taken out is a
- draw
- Owner K-1s
- Schedule K-1 (Form 1065)
Your structure decides which tax return ScaleLedger prepares numbers for, so it's set up with your ScaleLedger accountant. Changing it (forming an LLC, electing S corp status, adding a partner) is a bigger step than a setting. Tell us what's changing and we'll walk you through it.
Partners
Locked| Name | Owns | Equity at the start of the year |
|---|---|---|
| Jordan Hale | 50% | $13,731.91 |
| Casey Hale | 50% | $13,731.91 |
Partners don’t get wages. Money taken out is a draw. A set amount paid for work, regardless of profit, is a guaranteed payment. Ownership changes go through your ScaleLedger accountant because they change how profit is split.
Sign-in and security
- Two-step sign-in
- Required for everyone. Turns on with sign-in.
- Who can see these books
- Jordan Hale, Casey Hale, and your ScaleLedger accountant
- Who can change the official books
- Only your ScaleLedger accountant
How ScaleLedger handles each structure
| Structure | Files | Owners | Taking money out | Paying owners who work | K-1s |
|---|---|---|---|---|---|
| Sole proprietor | Schedule C with your Form 1040 | Just you | Owner’s draw | No wages; self-employment tax on profit | No |
| Single-member LLC | Schedule C with your Form 1040 | One member | Owner’s draw | No wages; self-employment tax on profit | No |
| Partnership You | Form 1065 | Two or more partners | Draw | Draws, or guaranteed payments for work | Yes, Form 1065 K-1 |
| Multi-member LLC | Form 1065 | Two or more members | Draw | Draws, or guaranteed payments for work | Yes, Form 1065 K-1 |
| S corporation | Form 1120-S | Up to 100 shareholders | Distribution, by ownership % | Reasonable wage through payroll | Yes, Form 1120-S K-1 |
| LLC taxed as an S corp | Form 1120-S | Up to 100 members | Distribution, by ownership % | Reasonable wage through payroll | Yes, Form 1120-S K-1 |
| C corporation | Form 1120; the corporation pays its own tax | Any number of shareholders | Dividend | Wages through payroll | No; owners get a 1099-DIV |
The books underneath are the same for every structure. The structure changes the labels, the tax-return lines, how owners get paid, and who is taxed on the profit.