Texarkana, TX · Member since 2013 · 5 posts · 0 votes
Can a managing member of an LLC live in a rental that the LLC owns without paying rent? The positve cash flow on other properties within the LLC would cover all expenses on the rental they would live in. Also, how would taxes be handled at the end of the year since the rental shows no profit? Any thoughts or ideas would be helpful. Thanks!
Property Manager · CA · Member since 2012 · 76 posts · 54 votes
11y
I certainly agree that it is possible to structure it in a way that part of your compensation or income (in comparison to the other LLC members) would be offset by the amount of rent. But what I believe James Wise was pointing out, it must be disclosed and agreed to by all members. This is typically structured and fleshed out in the operating agreement.
Specialist · Kirkland, WA · Member since 2013 · 1k+ posts · 817 votes
11y
Also, why not pay yourself rent? It makes your financials for the property look better.
The tax implications depend on the way that your LLC is set up. Are you an S-Corp or a C-Corp, a disregarded entity? Remember Tax Advice and Tax preparation are Tax Deductible! Talk to a CPA.