LLC member with guaranteed payments. We are taking the position only GP is subject to se tax. LLC member also has 179 and UPE. Should I prorate the 179 and UPE between GP and ordinary business income? Only seems fair.
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Guaranteed Payments go on Schedule E (Form 1040), line 28, And so does ordinary income or loss. Are you saying that you are counting the GP as SE and the rest as passive? Interesting. I'd love to hear if anyone else is doing such a thing.
Remember that passive investments can not take a 179 deduction. Which is probably why you asked about splitting it up.JG -
Some years back you will find hot discussions on this board on this subject (part of LLC income not subject to SE). So far IRS has been silent on this issue, as far as I know.Comment
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Matt Sova is very knowledgeable in this area, see if you can find some of his posts or if he might be stopping by for a glance maybe he'll jump in.Comment
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The IRS currently takes the position that if the member is a managing member or materially participates the income is SE.Comment
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Would you please give me reference to this position?Comment
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