All Forum Posts by: Robert Feldman

Those costs are deductible in the current year. Your tax preparer should be able to get those in the right place.

@Steve Hamilton II, A Schedule C can be filed if the other member is a spouse. It's called a Qualified Joint Venture (Or QJV). It has to be a spouse, he/she has to materially participate, and there will actually be 2 Schedule C's filed, one for each spouse recording their share of the income and deductions from the LLC.

I'm not sure on the particulars for the state of Florida. For federal purposes, you will need to obtain a new EIN. This only takes a few minutes, but changing everything related to that EIN can be a hassle. Also, unless the other member is your wife, who works 500 hours or more in the business, you will not be able to file a Schedule C on your 1040 for the business. You will be required to file a separate Form 1065 (or 1120 or 1120S) for the LLC before filing your 1040. Your share of the income will be reflect on a K-1 from the business for you to prepare your 1040.

You can take the full mortgage interest and depreciation deductions on rental properties as long as you have positive net income on the rentals. Your AGI will not come into play. However, if there is a loss there could be a restriction on the amount of loss you get to take. If you cannot take the loss in the current year, then you can take it against a gain in a future year.

It depends on whether the home is considered community property or not. If the home is not community property, then the step up in basis is only on the deceased spouse's half of the property. Under certain circumstances in community property states, there is a 100% step up in basis. If that's the case, then it is possible for the seller to realize no taxable gain on the property. Since I'm in Tennessee, which is not a community property state, I'm sketchy on the details. It would probably be worth consulting a local CPA.