All Forum Posts by: Lance Lvovsky

Elect to be taxed as a S Corp for your LLC if you will be flipping homes. You can pay yourselves a "reasonable salary" for some of the profits, and the remaining profits can be distributed as dividend income not subject to FICA

Xero is a nice accounting software solution and it is hosted in the cloud. As for whether that is a fair fee, hard to say without knowing the full scope of work.

Welcome to the forums, Ariel! You will find a lot of great information here. Feel free to reach out if you have any questions.

FYI - consult with an advisor before transferring property to an LLC. Plus your property has a mortgage... consult with an attorney. I am in no position to give you advice on a public forum on what to do.

I don't know why your accountant said it is hard or complex to split it up? It may be more time consuming as an allocation needs to be done on each taxpayer's tax return, but certainly not "complex". 

You would split all income and expenses based on the percentage of ownership each of you have. So if you own 20% of the property, then 20% of all income and expenses are reported on your return. 

You can't pass the income and expenses on the LLC tax return since the LLC does not own the property. You might be able to transfer title to an LLC and then take all income and expenses on the LLC tax return.

I assume you and your Partners purchased the property as tenants in common? You would simply split all income and expenses according to the ownership percentages in the property. Any interest on a loan that is attributable to your investment in the property is also deductible.

Check the other condos in the building and see whether they have a land assessed value. It is hard to imagine that the county is assessed all condos at 0% land value.

I just reread your first post. I would file the 2016 return showing the capital contributions on the balance sheet, Sch M-2 and Sch K-1.

I assume you got an EIN? If so you should file a tax return. It would be a "zero" return and the K-1's would be 0 too.

As mentioned before, most attorneys don't understand tax law. In an ideal scenario, you have both an attorney and a CPA on your team.