An LLC Partnership in 2013 was formed by 4 people who made short term loans to individuals with their personal funds. They filed the 1065 reporting the interest on Schedule K which of course flowed to their K-1 and was reported as interest on their personal returns. Prior to 2013, they merely divided up the interest amount and showed it on Schedule B. They were advised this could be construed as Schedule C income since it was a business. I would appreciate your opinon.
-
-
You are not talking about the business income being reported as interest are you? Were they in the business of making loans? -
1065
I suppose that is what it is but not the intent.They just made short term loans to individuals they know that needed money. Did they want it to be a business? No.Comment
-
They may want to consider applying for NFP status. Interest income could then be seed money to help more and/or small salary.Originally posted by pookiemaw View PostComment
-
Did they form on LLC and listed with the secretary of state?Comment
-
Yes, I think we realize it is a business and will go with that. ThanksOriginally posted by Super Mom View PostComment
Comment