Rental Property with Income that moved to LLC midyear

Forum|Forum|2 years ago
February 17, 2024
2 replies
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My wife and I have a rental property that had income for the first few months of the year, before we transferred the property to an LLC (partnership between wife and myself). We are filing a 1065 for the LLC. The question is, where should we show the income for the property before it was transferred to the LLC?

-Can we simply assign all the property income for the year to the 1065?

-Or do we need to separate income prior to the LLC into personal taxes Schedule C, and income after the LLC in the 1065?

Thanks

TurboTax Business Windows

Best answer by cdlvj130

you file Schedule E for the first part of year. Rest of it for year goes on 1065. Turbo Tax Business Edition will do the LLC, but I would investigate H and R, as it is much cheaper.

cdlvj130Answer

Employee

you file Schedule E for the first part of year. Rest of it for year goes on 1065. Turbo Tax Business Edition will do the LLC, but I would investigate H and R, as it is much cheaper.

AmeliesUncle

I'll also add a note that that the last time I checked, the Partnership program will NOT handle it correctly and give you errors for this situation. I don't know if other software can handle it well or not.

On the other hand, in my opinion every Partnership and Corporation should go to a good tax professional for AT LEAST the first year. There are way too many mistakes to be made for a first year (or last year) Partnership or Corporation, and despite their advertisements, do-it-yourself software is FAR inferior to a good tax professional.