Issuing 1099s or K-1s

[Justin R.]

A couple years ago, I bought and re-positioned a small MFR property. I allowed two extended family members to participate and invest some capital in exchange for a minority share of the property. This was documented, and the property has turned out great. There was distributable current cash flow from 2017 which was proportionally paid to each investor.

At the moment, the property is titled in my name only.  There is no registered partnership or entity involved.  I'm in CA, so registering a limited partnership or partnership with non-equal ownership percentages incurs paperwork and costs.

I would prefer to give each investor a K-1 with their proportional share of the depreciation benefit - that most closely matches how we're treating it.

Are there any options to do this?  Or, am I stuck sending out 1099-INTs?

Thanks in advance to BP Nation's tax people, CPAs, and tax law nerds!  :)

Note: Properties purchased later are properly housed in entities ... this one is an outlier.

[Christopher Smith]

How was the arrangement "documented" as you state? Sounds like something that might well suffice for a partnership agreement. I assume this document was done drafted contemporaneous with the beginning of activities?