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Updated almost 6 years ago on . Most recent reply presented by

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Patrick Menefee
  • Real Estate Coach
  • Charlotte, NC
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How are non-LLC business expenses handled?

Patrick Menefee
  • Real Estate Coach
  • Charlotte, NC
Posted

I have 2 properties under contract, one in my name and one in the name of my LLC that I just opened. I have a bank account and credit card I've been using so far for the one in my name, and once I get my EIN I will open a business account.

The only reason the new property is in the LLC is because it's a commercial property and I have a partner. I will not be transferring my other property into my LLC anytime soon, so they will remain split.

When it comes time to file taxes, I will have business expenses associated with my LLC and business expenses directly associated with me. Are these treated the same? Can I use the same credit card for both LLC and non-LLC business expenses?

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Michael Plaks
#1 Tax, SDIRAs & Cost Segregation Contributor
  • Tax Accountant / Enrolled Agent
  • Houston, TX
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Michael Plaks
#1 Tax, SDIRAs & Cost Segregation Contributor
  • Tax Accountant / Enrolled Agent
  • Houston, TX
Replied

@Patrick Menefee

I'm simply suggesting how to frame all of these questions for yourself.

You and two of your buddies go for a lunch, planning to split the bill. You also want to buy couple to-go boxes and desserts for yourself and your girl to eat at home tonight. Are you going to put all 5 meals on the same bill? Or are you going to put 3 lunches on one check (to be split 3-way) and pay for the two dinners separately? I hope this makes sense to you and you choose the latter, not the former.

You and your partner have a business which is completely separate from your personal business. It needs absolutely everything separate: separate bank account, separate credit card, separate bookkeeping, separate tax ID, separate tax return.

  • Michael Plaks
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