LLC-Living Expenss

[S T]

Have a new client (LLC) - Form 1065 Partnership - the one Member is a Washington State Resident - but is now living in Texas where the LLC is operating

They have a notation of an expense for Living Expenses (rent, utilities) for this Member - Would this be Temporary Living Expense (will last longer than 1 year)? and the LLC takes as an Expense --- or is this more like a Guaranteed Payment to the Member? Or???

I don't believe there is an issue with Biz Travel, or Biz Auto, but not sure how to treat these "Living Expenses"

thanks

Sandy

[Lion]

Draw to partner unless the partnership agreement explains them differently. GP is a possibility.

[WhiteOleander]

I'm not sure why the member thnks that the prtshp can pay his living expenses and it not be taxable income to him. I would also say as GP subject to SE.

[Gary2]

Have a new client (LLC) - Form 1065 Partnership - the one Member

Does this mean there is only one member, in which case it's not a partnership? Or did you just mean your client?

[S T]

There are 3 members, one of the Members is from Wash State

[AZ-Tax]

So is the LLC itself one of the Partners?

So is the one member LLC itself one of the Partners?

[S T]

It is an LLC with 3 Members, one of the Members is what the LLC is looking at paying the Living Expenses for that member. Operating agreeement is silent on this issue.

S

[Burke]

Income to that member, unless it can be classified as temporary assignment (less than one year) and handled through direct reimbursement plan for lodging/travel.