All Forum Posts by: Julio Bradley
Julio Bradley has started 2 posts and replied 6 times.
Post: LLC Protection and tax advice
- Posts 6
- Votes 1
Hi,
I'm a U.S citizen with rental properties in the U.S. I have one property in a single member LLC and another property in my name only. I plan on moving this property into a separate LLC later on. Is there any legal advice on making sure the LLC's protect my personal assets. My current LLC has separate bank accounts and separate street addresses. Is there anything I need to be aware of when doing this, or if there is any helpful advice when doing this?
Also is the form 1040E all I need to file my LLC during tax season? My CPA said that the information on the 1040E will also need to be filed along with a 1040C, but that doesn't make any sense.
Quote from @Natalie Kolodij:
Quote from @Julio Bradley:
Quote from @Natalie Kolodij:
Just to confirm- are you based in the US?
If so- An LLC being created would not generate a schedule C for a rental, it would still report on Schedule E (the same way it would without an LLC)
How much protection an LLC offers is open to interpretation- but your tax professional isn't an attorney and shoudln't advise on this.
You absolutely should not move a rental into an S corp- it creates a whole slew of issues related to creating MORE tax on your rental property.
I'd recommend potentially looking elsewhere for your tax sevices.
Hi,
Thanks for the reply. I am based in the U.S. I did file the 1040E and they said the 1040C is also necessary. Should I file the LLC separately. Is the 1040E all thats needed to remain in good standing with the state (there are no fees in my state). Are there any tax laws or IRS docs I can show them to rebuttal this? Do you know of any good CPAs that I can talk to? Thanks again
This is a hard one to rebuttle becuase it's just common knowledge.
A single member LLC is a disregarded entity. Period. It doesn't exist or change filing status/form in any way.
So if what it does is a farm- it still goes on F
If the LLC does a business it's sch C
IF the LLC does a rental it's scn E
They are thinking an LLC= a business - which is wrong
And they are likely planning to put any general administrative/business costs on Sch C
Which would make them non-passive, non-tied to rentals, and those losses deducitble incorrectly.
I woudln't try to "Teach" this basic concept to a CPA- I'd find a new one.
Thank you very much for the response. Since my LLC is a disregarded entity, would it still provide protection from my personal assets? Do you know of any good CPAs I could turn too. Thanks
Quote from @Natalie Kolodij:
Just to confirm- are you based in the US?
If so- An LLC being created would not generate a schedule C for a rental, it would still report on Schedule E (the same way it would without an LLC)
How much protection an LLC offers is open to interpretation- but your tax professional isn't an attorney and shoudln't advise on this.
You absolutely should not move a rental into an S corp- it creates a whole slew of issues related to creating MORE tax on your rental property.
I'd recommend potentially looking elsewhere for your tax sevices.
Hi,
Thanks for the reply. I am based in the U.S. I did file the 1040E and they said the 1040C is also necessary. Should I file the LLC separately. Is the 1040E all thats needed to remain in good standing with the state (there are no fees in my state). Are there any tax laws or IRS docs I can show them to rebuttal this? Do you know of any good CPAs that I can talk to? Thanks again
Quote from @Account Closed:
Assuming you are not actively managing the property (you have a PM?) and assuming you are the only member of the LLC, it should pass-through on the 1040 E.
Hi,
Thanks for the reply. I am based in the U.S. I did file the 1040E and they said the 1040C is also necessary. Is there any tax laws or IRS docs I can show them to rebuttal this? Do you know of any good CPAs that I can talk to? Thanks again
I recently moved one of my rental properties into an LLC to protect my personal assets. When I filed my taxes, my tax agent said that I must file a 1040C for the LLC and that the 1040C does not protect my personal assets. They told me that I must move the property into an S-Corp in order to shield personal assets. Any guidance or tax laws for this? Any questions I Can ask the agent for further explanation or rebuttal? Thanks for any input