LLC pays rent of building to partner

[JenMO]

Is that a deduction on the 1065, or a guanteed payment on the K-1?

[TaxGuyBill]

Are you saying that one individual Partner owns the building, and that the Multi-Member LLC/Partnership is using the building for its business and therefore paying rent to the Partner to use it?

[JenMO]

Partner owns building, llc pays rent to use building yes

[TaxGuyBill]

Rent would be a deduction on the 1065. It doesn't matter who owns the building for that purpose.

The business may need to issue the Partner a 1099-MISC (Box 1) for the rent though.

[JenMO]

ok, thanks

[ATSMAN]

Self-Rental Regulations

Watch out for the self-rental rules. This is a trap many owners who rent themselves their own property fall into!