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Solved

Transferring a rental property to an LLC

Forum|Forum|5 years ago
January 5, 2021
1 reply
0 views

My wife and I have owned a rental property for over 5 years. Income and expenses were reported on a schedule E. While doing estate planning, our attorney suggested we move the property to an LLC which was formed on 3/30/2020. Since there were no liens (or debt), the attorney transferred the property to the LLC. Based on the posts I read, this may have been a bad idea, but it's done and I need to report my earnings.

Do I just continue to report the income and expenses on the schedule E or do I need to create a new property affective 3/30 and close the old property?

Any help, guidance, or suggestions would be greatly appreciated.

TurboTax Home & Biz Windows

Best answer by AmeliesUncle

@BrotherRick wrote:
And to clarify, it is a single member LLC.

For income tax purposes, a Single Member LLC is "disregarded" (assuming the LLC has not elected to be taxed as a corporation).

That means you report it exactly as if YOU owned it. So yes, it goes on Schedule E and for income tax purposes can be reported as if nothing changed.

Unless you have to file a partnership return for the LLC you can just leave the rental on your personal return Sch E like you have in the past.

BrotherRickAuthor

Just to verify, I don't have to add a new property and close/end the one I've been using for years?

Thanks for the quick and very helpful response!