I have used this lease for 7 year without running into this issue.

You did not mention any payment issues, have you been collecting mechanics liens with each payment installment?

Taylor,I hope you aren't still dealing with this issue!

Each year by January 31, you or your bookkeeper has to total up how much you have paid to each person and issue each one a 1099, which is a simple statement of that total amount with your contact information as the payor. 

3- To record incomes and expenses correctly for tax issues, do we need to make an official contract for the renovation (between the LLC and one of the owners), or is simply issuing invoices and receiving payments in the LLC’s bank account enough?

  :)Financing for FHA and VA  will evolve to address their issues. 

Hi Matthew, Remember, navigating legal issues with tenants can be complex, so it's crucial to proceed cautiously and seek professional legal advice when necessary.

While the IRS allows this, it is a taxable issue.

If so, that will be an issue, unless there is a specific bank loan that keeps the note in their portfolio and is okay with the condo being non-warrantable.

However, as first-time and inexperienced homebuyers, we overlooked critical issues during the initial inspection.