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August 26, 2022
Question

Writing off LLC Costs on Home Flipped to Self

  • August 26, 2022
  • 1 reply
  • 0 views

I purchased a home in the name of my LLC with a hard money fix and flip loan with the intentions of reselling.  My sole member LLC incurred a great deal of expenses in renovations and carrying costs and then I decided to live in the house and keep it as primary residence.  I refinanced the hard money loan with a personal mortgage, transferring ownership from the LLC to myself in the process.  Can I deduct my expenses and carrying costs from the LLC related to this property when filing my schedule C on my taxes?  I had another house flip and loan in action under the LLC during the same timeframe that I will be reporting income and deductions for.  Thanks in advance!

    1 reply

    August 26, 2022

    I would think this is property converted to personal use so expenses are not deductible. capital expenditures would add to your basis. 

    August 26, 2022

    @rubylove if it is not as @Mike9241 suggests, then everyone in America would buy their homes through LLCs so they could write off the improvement costs...... 

    Employee
    August 26, 2022

    @rubylove wrote:  "I decided to live in the house and keep it as primary residence." 

     

    In that case nothing related to this property goes to Schedule C.

    **Answers are correct to the best of my ability but do not constitute tax or legal advice.