Transferring loan to partnership

[Nick Dunbar]

I wanted to ask a simple yet complicated question about leverage on your properties. As a CPA, I’m aware of the implications of establishing your business incorrectly or the possibility of losing tax attributes due to oversight.

I’ve done some cursory research but still need some real world guidance. I have a property (my first property!) I’m negotiating on currently where they are willing to do seller financing, but to be conservative I’ve run the numbers both with a conventional loan and with seller financing. I’m planning to get the deed under my partnership at the time of seller financing.

After talking with a few local portfolio lenders, they advised me to finance it personally and transfer the loan to the partnership within 60 days. They have assured me they would not exercise the due on sale clause. The question comes in at this point. If I transfer the loan to the partnership do I lose any tax attributes such as depreciation on the property.

Thank you for any help or insight you can provide!