Buying & Selling Real Estate Discussion

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Transferring LP interest to Personal interest - Tax Liability

Posted May 11 2022, 17:47

Hello BP - I have a question... 

Currently, I am invested in a new development syndication as an LP. The funds were invested from my LLC.

Recently, we hired a CPA who advised us to invest from our personal account solely as tax benefits are lost with the future distributions going through the LLC entity.

Now the question... has anyone transferred interest in a syndication from their LLC to personal holdings? If so, what are the tax liabilities that come with that? Is this tax as a sale?

Much thanks! 


Austin, Texas

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Kevin Sobilo
  • Rental Property Investor
  • Hanover Twp, PA
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Kevin Sobilo
  • Rental Property Investor
  • Hanover Twp, PA
Replied May 12 2022, 07:53

@Gregory Patrick Strake, can you explain in any more detail what tax benefits get lost and why?

If your LLC is a simple single member LLC then for federal tax purposes its a disregarded entity. So, I don't see how that would affect your tax situation at all. If it isn't a simple single member LLC, then it could be different of course.

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Basit Siddiqi
  • Accountant
  • New York, NY
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Basit Siddiqi
  • Accountant
  • New York, NY
Replied May 21 2022, 16:57

@Gregory Patrick Strake

Your CPA sounds like he is unfamiliar with LLC's. I would run from him.
LLC's are pass-through entities and the character of the income will flow to your individual return(Regardless if it is a single member LLC or a multi-member LLC).
The only exception is if the LLC elected to be a corporation.

Fire your CPA.