Starting a sole proprietorship with a partner/supplier in Peru, how do i share profits and avoid tax problems? -

Hi all,I m starting a business and i have a business partner (very trustworthy) in Peru. We re going to be in retail essentially importing quality handmade clothing and misc from Peru to the US. Establishing this as a sole proprietorship, i have to declare the profits as personal income . The problem is i have to share the profits 50/50 with my partner. How do i declare that 50% that goes to my partner in my taxes....wont the IRS audit that? What efficient way is there to share the profits, declare my taxes and have everything be legit?One more thing, Since my partner is my supplier, he will send the goods here to the US. Do i have to pay any tariffs on Importing those goods?Any help will greatly be appreciated.

Might be a little dicey if you go to deduct the profits you are sending to Peru as a business expense. Not sure that is going to fly.I think you will need to either form an official partnership, so the partnership return can show the distribution of profits, or another form of business (LLC, S corp, C corp) that gets different tax treatment than a sole proprietor. All three of these can deplete cash at the end of the tax year so the LLC/Corp is not taxed, and you are only taxed on your half at your personal rates.