@Jeff Cardello   You've over simplified a sub to closing by miles!   

While this simplifies tax reporting, it might not provide the same level of liability protection as a multi-member LLC.Separate Tax Returns for Each LLC:While it might be more administratively burdensome, having separate tax returns for each LLC could strengthen the separation of assets for liability protection purposes.

The portion of the property that you use for personal purposes is not considered a rental property for tax purposes.Here's a simplified example to illustrate:Let's say you own a duplex, and you live in one unit while renting out the other.

., as a sole proprietorship, partnership, S corporation, or C corporation), depending on your tax situation and investment goals.Pass-Through Taxation: By default, an LLC is a pass-through entity, meaning that profits and losses are passed through to the owners' personal tax returns, simplifying the tax process.Considerations for Creating an LLC:Cost and Maintenance: LLCs come with initial setup costs and annual maintenance fees.

If you sell the property in 2024, the remaining "what would have been depreciated" over the subsequent years is subject to depreciation recapture.Here's a simplified calculation:Total Depreciation Taken: Let's say you've taken $1,000 in depreciation each year from 2020 to 2023, totaling $4,000.Remaining Depreciation to Be Recaptured: The remaining depreciation that would have been taken over the years 2024 and beyond (up to the end of the useful life, which is 27.5 years in total) would be $7,000 - $4,000 = $3,000.When you sell the property in 2024, the $3,000 remaining depreciation would be subject to depreciation recapture.

Current expenses are usually deductible in the year they are incurred, while capital expenses may be recovered over time through depreciation.Safe harbor rules may provide a simplified method for determining whether certain expenses can be immediately deducted rather than capitalized.

This deduction can help reduce your taxable income.Tax Credits: Research and take advantage of available tax credits, such as the Earned Income Tax Credit, which can offset your tax liability.Retirement Plans: Contributing to a self-employed retirement plan like a Solo 401(k) or a Simplified Employee Pension (SEP) IRA can reduce your taxable income.

This is a common practice for LLCs with only one member, and it simplifies tax reporting.Rental Properties in an LLC: If you have properties held in your LLC's name, the income and expenses related to those properties are typically reported on Schedule E (Supplemental Income and Loss) of your personal tax return.

Overall, concentrate your powder to simplify your life and gain an advantage.

Perhaps, to simplify things I could simply agree to a price for each year that passes in attempt to match the balance of the loan.