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LLC paying another member-owned LLC rent

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ADLER

Junior Member
North Carolina.
Wasn't sure if this should go in Real Estate or Tax Law.
I have an LLC set up, where I am the owner. This LLC is for Ebay sales.
We'll call it LLC "A"
I would like to work on getting LLC "A" income to $0, or as close as possible.

I would like to purchase an investment property, and open a new LLC for real estate, we'll call it LLC "B"

Can I have LLC "A" pay LLC "B" rent on a monthly basis, thus reducing "A's" income, and also providing me with depreciation on an investment property, where I am the owner of both LLCs?
 


ADLER

Junior Member
I always like to answer my own questions, but according to the instructions for IRS form 1065: Line 13: Rent

"Enter rent paid on business property used in a trade or business activity. Do not deduct rent for a dwelling unit occupied by any partner for personal use."

http://www.irs.gov/pub/irs-pdf/i1065.pdf

so, it sounds like I should be fine since I won't be using the property for personal use....
 

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